[A-share market fluctuates sharply, option arbitrage strategy risks are amplified] On October 16, a well-known private equity firm Power Asset announced a suspension of fees, which attracted attention from the industry. Power Asset announced in its official microblog that due to the sharp market fluctuations, the company's option products experienced a record retracement. In order to restore the net value as soon as possible, the company decided after internal discussion to suspend the collection of management fees for its option products in turn. "The characteristics of option arbitrage strategies are that they usually earn little and have stable performance, but they may suffer large losses in extreme market conditions, so the risk control requirements of managers are very high. There are many lessons learned overseas. The more typical LTCM (Long-Term Capital Management) adopted an arbitrage model and eventually went bankrupt due to huge losses." Private equity professionals said. It is worth noting that in the sharp fluctuations in the A-share market last week, in addition to the price changes themselves, the volatility of related ETF options and stock index futures options also rose sharply, which brought considerable challenges to traditional option arbitrage strategies. The over-the-counter options market encountered more problems, and even failed to cash out. (Securities Times) (Reprinted from: Jinshi Data)