Thread by @thevdm1

If options leave your brain begging for mercy this thread is for you! 💣🧠

So UMA recently launched a call option 📞📈 The kind of option that’s good to hold when ‘numba go up’. So let’s break it down and make some money! 💰

The option is called UMAc35-0421 - some useful information in the name, but since it probably burns your eyes 🔥👀 let’s name this option Roger. Let’s look at two perspectives: A Roger buyer 💃📈 and a Roger seller 🕺📉.

If you bought a Roger today, it would cost 0.061 UMA ($1.34). Holding a Roger now gives you the right to buy UMA at $35 on the 30th of April. If UMA is on a moon mission this can be very profitable!🌚Consider UMA trading at $70 on the 30th April - Roger lets you buy UMA at $35💸

A chunky discount! 💸 Roge makes it rain!

That said, nothing is risk free. If UMA refuses to embark on the moon mission ❌🚀 and doesn't trade above $35 by 30 April. Roger dies, he cost you 0.061 UMA and gave you a right that expired worthless⚰️. Roger is now sounding more like a conman than a rainmaker. 🕵️🚨

Now, if that sounds too risky for your liking why not mint 🌿and sell a Roger for the 0.061 UMA? The same two scenarios unfold but in a reverse perspective.🌬️🏎️ (to be super technical miniting replicates a covered call postion - less risky than just selling a call)

UMA moons! 🚀 Shooting from $22 all the way to $70. Because Roger forces you to effectively sell your UMA for $35 you cry a bit realising you missed out on the 100% return from $35 to $70 😭.

But then you stop crying when you realise you still get to keep the 0.061 UMA you earned (up substantially in $ terms) and you still profit from UMA moving from $22 to $35 (+60%).🤑

UMA no moon ❌🌚 and never trades above $35 before Rodger dies on 30 April (R.I.P). 🕊️ Because you sold a right that expired useless, you pocket the UMA you earned and smile about your 6.1% UMA profit earned in the space of a month and you get all your UMA collateral back 💵

(For the record 💵1 UMA in collateral allows you to mint 1 Roger)

For the technical guys/gals out there you can use this calculator Kevin used in his post goodcalculators.com/black-scholes-… to do the fancy mathamatatics 📚➕📐➗📏 that option sellers like to do to get better grips on how cheap Rodger is to buy or nice and expensive to sell. 💭

Certainly not financial advice, but if I were to sell or buy a Roger today I’d be selling! You can mint 🌿 Rogers on mysynths.finance which can be then sold to the Sushi 🍣 UMAc35-0421 pool (Rogers can also be bought directly from here - no minting necessary) 💃📈