Discover and read the best of Twitter Threads about #derivatives

Most recents (22)

How do #Options work? How to include options into your strategy? Why do we need options products in #DeFi?

We cover all of the basics you need in our latest visual guide, decentralized options.


#Cryptocurrency #Bitcoin #Ethereum #AVAX #BNB #Derivatives Image
An option is a #contract giving the investor the right, but not the obligation, to buy or sell an underlying asset at a specific price on a certain time period. Investors must pay a premium to get the contract.


#Cryptocurrency #Bitcoin #Ethereum #AVAX #BNB #Derivatives Image
The option writer is the seller of an option who opens a position to collect a premium payment from the buyer of the options contract.


#Cryptocurrency #Bitcoin #Ethereum #AVAX #BNB #Derivatives Image
Read 19 tweets
What to expect from our On-chain #SpotOrderBook #DEX going live on $NEAR #Mainnet 😍 Image
1/ An On-chain #Orderbook and matching form the backbone of the #derivatives infrastructure we're building 🔥
2/ @NEARProtocol
users can start enjoying a CEX-Competitive 🥳
Read 5 tweets
Before wars begin and end, the country strategists must invest in proper risk analysis and intelligence.
Country Risk Analysis is not just about surveying Banker's Almanac or doing lousy ratio analysis and setting risk limits to counterparty exposures, jurisdictions, desks, etc.
Very few financial institutions and especially banks hire country risk analysts.
Most of the work is done by credit underwriting and back-office analysts with some input taken from Compliance, and Risk Management Desks.
Credit Manuals talk little about International banking.
Global Banks should hire Political Science, International Political Economy Experts, and related subject area professionals, who can provide qualitative input that is needed for risk assessment.
ECL/Default Risk is not just LGD X PD X EAD.
@BIS_org must provide more guidance.
Read 6 tweets
China has dealt with 25 trillion yuan of shadow banking over the past 5 years. China's #realestate bubble has curbed in 2021, s Guo Shuqing, the head of China's banking regulator CBIRC.
#Evergrande #Shimao
#China will implement instructions from recent inspection, will forestall, defuse risks and push high-quality development.
Guo also says China needs strong measures for the economy, but not massive stimulus.
Will make targeted policies aimed at Small- and Medium Enterprises.
Guo Shuqing says #China will speed up the standardization of corporate credit #bonds, push forward the legislation on financial stability and #derivatives.
Read 4 tweets
When i started off in #derivatives #trading, some 15 years back, the "default trade" taught to us was to trade in Futures or to BUY calls or BUY puts as the need arose.

These days the "default trade" is to SELL calls and SELL puts.
Thanks to a spurt in online education, you learn quickly to sell options at 09.25 am and at 12.30 pm and every time of the year.

No education is provided for things like VIX, directional volatility, IV smiles or even basic gamma math
And the numbers speak.

The option market today is 10 times the volume of the Futures market.

and this is just the weekly contract & on normal days of fri to wed.

On Thursday the Option volume market goes up 3X or 30 times the Futures Volumes , mostly writers closing positions
Read 18 tweets
1/51 The crypto market has changed significantly over the past year

In this episode of @TheScoopPod, host @fintechfrank speaks to @joshua_j_lim of @GenesisTrading to gains insights to these changes Image
@TheScoopPod @fintechfrank @joshua_j_lim @GenesisTrading 2/51 Key Takeaways

1. Complex products such as crypto derivatives are entering the market
2. The Basis Trade will converge with spot price over time
3. The crypto market is maturing and volatility is decreasing
4. Joshua aims to hire people who can tread between TradFi & Crypto
@TheScoopPod @fintechfrank @joshua_j_lim @GenesisTrading 3/51 Background

• Head of derivatives at @GenesisTrading Image
Read 51 tweets
Time for a 🧵 on two charts (at the end) that seem to tell an interesting #Bitcoin story.

For several yrs @CaitlinLong_ has openly discussed the potential negative impact of #rehypothecation of #bitcoin by banks, wall street, hedge funds & the broader #tradfi community.
@saylor has discussed and shown the need for sound money and the value that having a savings mechanism brings to the system.

@JeffBooth has shed light on the fact that #deflation isn’t such a bad thing when #technology is actually making our lives better and costs cheaper.
@saifedean taught the 🌏 the importance of time, effort, and energy & the value that living by the #Bitcoin Standard can bring to individuals and countries across the globe.

@FossGregfoss has done a phenomenal job helping to #educate on the benefits of owning #volatile #assets.
Read 24 tweets
How much maths is needed in #private #equity (also when compared to hedge funds or investment #banking, for example)?
@GAIAnoburn @CAIA_Blog
Private Equity requires a good understanding of Finance and especially sector-specific finance such as Real Estate Finance and Investments and so on.
In my opinion, the techniques used to model PE transactions have a lot in common with those that are applied to Listed Equity.
It has some maths in it, but nothing out of the world!
Read 13 tweets
1/ Thread: #DeFi For Dummies 002: #DeFi Basics.

DeFi is a hybrid #smartcontract that combines on-chain code with off-chain proofs.

DeFi relies heavily on cryptography and blockchain technologies.

#blockchain #DeFi
2/ Thread: #DeFi For Dummies 002: #DeFi Basics

DeFi is taking on the contractual agreement you find on the global financial system in a permisonless and open way. MakerDao was the first DeFi project started in 2015
3/ Thread: #DeFi For Dummies 002: #DeFi Basics

The #DeFi EcoSystem.

a) #Lending & #Borrowing:- These are algorithmic autonomous interest protocols that allow users to supply protocols like ether etc.Eg: Compound and Aave
Read 10 tweets
Some thoughts & ramblings on @synthetix_io and $SNX price action.

I've been staking since Epoch 1 and have seen how the price is affected by different things in the market.

🧵 1/x
First of all it is vital to understand that $SNX is not a passive Gov token. Its true worth, is having it staked to earn rewards.

The goal is to have transaction fee rewards in $sUSD outweigh $SNX rewards by some magnitude in the future.

This is currently not the case as the protocol emission is still incentivising staking heavily. But this will change as the emission model reduces $SNX over time and all the building block start falling in place that will drive Transactions through the protocol.

Read 24 tweets
#derivatives #nse
Data analysis not an easy task as it's look like.
Today I am talking about specially long or short buildup only. Everyone knows including book says when price going up with oi up is long buildup.
But in reality only few mins or one day buildup not enough to summarise it also confirmation required after any kind of buildup.
Let's explore more...
Any big players in intra or swing trader can't enter in mkt at once it's slow process.
And took almost good time for swing trader sometimes 3-7 days even more. For intraday it's in range of 30-60 mins.
Never judge direction so soon, until after buildup range not break or if some technical combination much better (optional).
Read 6 tweets
Mirror Derivative

@mirror_protocol allows users to create synthetic assets based on real assets, thereby making it easier for users to buy and sell ($mAssets).

#Derivatives #DeFi #cryptocurrency #Blockchain #cryptoderivatives
Example: If a house costs $100,000 but the user only wants to buy $50,000 worth. Then, it can be purchased by splitting 100,000 tokens, each worth $1. The user only purchases 50,000 tokens.
To generate $mAssets, users must collateralise assets worth > 150% (if using stablecoin) or > 200% (if using $mAsset). For example: If you want to mint $100 worth of $mXAU, you must collateralise 150 $USDT or $mBTC worth $200.
Read 5 tweets
I will not invest in a mutual fund, until and unless I won't carry out specific due diligence of my own.
These @MorningstarInc style fund reports are not very helpful.
You should know inside out about the management and especially the fund manager who will be managing your money.
The standard Bull Shit advice marketed in the industry by investor relations and advisory experts =>
Maybe you can check out the Sharpe and Sortino ratios for funds before investing.
If you understand risk management concepts, do check out the VaR - Value at risk figures of all the competing funds drawn from the universe of investment possibilities.
Read 28 tweets
Is this Unanticipated or Anticipated Inflation Risk?
This is what economists need to explain to us!
We knew it was coming due to the reflationary policy stance of central banks in the first world, and elsewhere.
But, the augmented rate was not unexpected.
But, this is not the 1970s, when oil price shocks, and other supply-side macroeconomic and microeconomic distortions of the postwar years raised the inflation rate unexpectedly to astronomical heights.
I don't see any massive stagflation developing due to technological gains.
Yes, the "PHILLIPS CURVE" is officially deceased.
won't return again!
Monetarists and some other schools of thought have created hues and cries of the return of the economic phantom, but, no, it won't happen.
Prices and #Unemployment have been disentangled.
Read 9 tweets
Buy Vs. Sell-Side Risk Information: Time to Differentiate between “Your Risk” and “My Risk” Reports
@CFAinstitute @GARP_Risk
Report Sample of Asset Allocation Analytics
Well, we all are accustomed to reading “Buy” and “Sell-Side” Investment Evaluation Reports prepared by Financial Research Analysts at various FIs such as Investment Companies operating in the Financial Markets.
Read 50 tweets
A brief 🧵 on why @LHSummers is an arrogant buffoon who, despite a long track record of being massively wrong, still seems to command the respect of policymakers
We can start with #BrooksleyBorn, the prescient head of the @CFTC, who loudly warned of the dangers of the over-the-counter (OTC) #Derivatives market in the 90s:…
The powerful cabal of @LHSummers, #RobertRubin, and #AlanGreenspan pushed hard against the regulation of derivatives, paving the way for massive financial and human carnage of the #GreatFinancialCrisis…
Read 13 tweets
Why do young people leave quantitative trading 5 to 7 years in their career, and what's your advice for aspiring quantitative traders?
@CQFInstitute @RiskDotNet @icmacentre @RiskMinds
The burnout (losing interest in the job) and dropout(leaving the job) rates are stupendous.
#Quantitative Specialist Roles as they exist in the Dealing Room in the form of #Treasury, Brokerage, Fund Management, #Investment Management, #Portfolio #Asset Management, #Derivative Market Making, and various other Front -Office #Risk Roles are highly demanding jobs indeed!
Most of the traders are asked to take a mandatory leave of up to two weeks or more at financial institutions, so they can relax a bit by staying away from the financial markets.
Read 10 tweets
What is the difference between financial econometrics, econometrics and quantitative finance?
@GARP_Risk @CQFInstitute @SOActuaries
Financial Econometrics basically utilizes Financial Market Data to build mathematical and statistical financial models and later analyze the statistical significance and make predictions.
It is generally used by risk managers and economists to predict(forecast) and study the return market characteristics. GARCH models and other Time Series Models are used to study the pattern of Return Volatility Clusters, Tail Dependence Events, Covariances,
Read 14 tweets
I am humbled and privilleged to note that my #Research paper; "Sources of #Unemployment in #Lesotho" is now available and can be accessed via the People's Republic of #China's National #Science and #Technology #Library - #NSTL. I give thanks 😎 Image
So far this year, I have successfully published three #Research articles in #Macroeconomics & #Finance, with another two in press. I am currently hammering away at a handful of working papers which will most certainly find a home in reputable #Journals, come 2021 🙏🏽🙂 Image
Im currently internalising the very insightful reviewer comments on my latest #Research paper titled; "Investigating Determinants of Commercial Bank Spreads in #Lesotho", from the good folks over at the globally reputable #International #Journal of #Finance & #Economics #IJFE 😊 ImageImage
Read 52 tweets
#TweetStorm #AdaniEnterprises Volumes. 1)
Today the stock was up 25-30% in the day. Its a derivative stock. Total Delivery Volumes were 35 lakh shares and only 6.7% of the total traded quantity. Thats roughly 0.3% of Equity. Stock was in #Ban today. Out now.
2) Shareholding Pattern. Promoters own 74.92%, #FIIs own around 20.07%, #MutualFunds mostly arbitrage positions another 1.07%. Thats a sum total of 96.06%. Not much of a change in these owners since a few quarters.#Retail below 2 lakhs paid up capital owns only 2.17%.
The Float available is roughly 4.2 cr shares.
The company added 6700 cr of market cap with a delivery value of around 100 cr odd.
Free Float may be 25% but actual is less than 4%. Why should it be in #Derivatives. #MWPL limits keep it in ban all the time. No view on company.
Read 3 tweets
#Options vs #Futures

Although both are #derivatives, Futures and Options are entirely different in terms of their potential #risk and #return , #leverage and how they work.

How different are futures and options?
#Rights vs #Obligations

In #Futures Trading, both the buyer & the seller are #obligated to settle the contracts on or before expiry ie cover shorts or longs or rollover to next contract, regardless of how the underlying asset price moves.
With #Options the buyer has the #Right, but not the #Obligation, to buy (call option) or sell (put option) on underlying asset. The option seller is #passive and must comply with whatever the option buyer does.
Read 13 tweets
#Option #Greeks Simplified

#Options are definitely more complicated than equity or futures.

Their prices don’t just go up and down.

They also fluctuate based on things like #time, #implied #volatility and #underlying stock movements.
#Options #Greeks Are Simply Mathematical Shortforms

Most of you would remember from school that mathematical formulas sometimes were #Greek letters like Pi and #Delta. The same is true for options.

Don’t let them overwhelm you or scare you.
They’re simply #mathematical words to explain some very basic principles.

#Greeks Describe the Behavior of #Individual #Options

Each #greek can help predict how it will behave under different circumstances and how options prices would change.
Read 22 tweets

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