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Deribit has achieved a new all-time high in notional open interest, with $16 billion in Bitcoin options and $7.6 billion in ETH options outstanding, totaling $23.6 billion. With an additional $2.2 billion in perpetuals and futures open interest, Deribit has crossed the milestone of $25 billion for the first time, now totaling $25.8 billion.
#BTCto40k #futures #options $BTC $ETH
#BTCto40k #futures #options $BTC $ETH
What are #options ?
For intermediate and expert traders.
For newbies just read it, only trade with what you understand.
I just found that and it is different from futures. Some details:
⚪ Traditional market´s volume of Options are higher than futures and spot together
⚪ Contracts between two parties to buy/sell an asset in the future at a given price
⚪One party has the right, but NOT the obligation, to carry out the transaction at that fixed price (with Futures you have to buy or sell it)
⚪Similar to futures, BUT no risk of liquidations (with Futures, high risk)
⚪Have to pay some fee (Futures don´t assume previous costs)
⚪Loose value as expiry date approaches (in futures, time doesn´t affect them)
⚪More flexible and you can adapt them (futures are more standarized)
Source: Healthy_pockets
For intermediate and expert traders.
For newbies just read it, only trade with what you understand.
I just found that and it is different from futures. Some details:
⚪ Traditional market´s volume of Options are higher than futures and spot together
⚪ Contracts between two parties to buy/sell an asset in the future at a given price
⚪One party has the right, but NOT the obligation, to carry out the transaction at that fixed price (with Futures you have to buy or sell it)
⚪Similar to futures, BUT no risk of liquidations (with Futures, high risk)
⚪Have to pay some fee (Futures don´t assume previous costs)
⚪Loose value as expiry date approaches (in futures, time doesn´t affect them)
⚪More flexible and you can adapt them (futures are more standarized)
Source: Healthy_pockets
Bitcoin’s $2 Billion Options Expiry: A Look at Potential Support and Market Impact ⚠️
#BTC traders are focused on the $31,000 price level with a $2 billion Bitcoin #options expiry on July 28. The recent interest rate increase by the U.S. Federal Reserve affected risk-on assets like cryptocurrencies, but Bitcoin bulls believe its impact takes time.
Previous monthly expiries caused rallies and corrections. Bulls have regulatory and ETF momentum, with major fund managers requesting spot Bitcoin #ETFs , and U.S. House bills aiming to clarify distinctions between securities and digital commodities.
Positive corporate earnings and consumer confidence data support bullish momentum, indicating a reduced recession risk in the short term.
#Binance
#crypto2023
#BTC traders are focused on the $31,000 price level with a $2 billion Bitcoin #options expiry on July 28. The recent interest rate increase by the U.S. Federal Reserve affected risk-on assets like cryptocurrencies, but Bitcoin bulls believe its impact takes time.
Previous monthly expiries caused rallies and corrections. Bulls have regulatory and ETF momentum, with major fund managers requesting spot Bitcoin #ETFs , and U.S. House bills aiming to clarify distinctions between securities and digital commodities.
Positive corporate earnings and consumer confidence data support bullish momentum, indicating a reduced recession risk in the short term.
#Binance
#crypto2023
0DTE option traders turn aggressive, stock market facing insane volatility 📈📈
With their well-advertised long biases in fixed income vs underweight in equities, hedge fund and professional money managers have been scrambling to add long-call exposures in the SPX over the past few sessions as stocks squeezed higher. The ferocious market rally blew past the areas of max call exposures in a hurry (~4185 on cash SPX), with 0DTE players having flipped to (supposedly) net short gamma since April, thus adding further rally fuel on the way up. Street research now estimates market gamma to be back positive at the current index levels, and we'll also be seeing a decent sized OpEx expiry today which should add to an exciting close to the week. #options
With their well-advertised long biases in fixed income vs underweight in equities, hedge fund and professional money managers have been scrambling to add long-call exposures in the SPX over the past few sessions as stocks squeezed higher. The ferocious market rally blew past the areas of max call exposures in a hurry (~4185 on cash SPX), with 0DTE players having flipped to (supposedly) net short gamma since April, thus adding further rally fuel on the way up. Street research now estimates market gamma to be back positive at the current index levels, and we'll also be seeing a decent sized OpEx expiry today which should add to an exciting close to the week. #options
Extend Your Crypto Trading Strategy With Crypto Options
Before going further let me highlight the important things that you should understand in this article:
What are Binance Options?
How to trade Binance Options
What are the USPs of Binance Options products?
What is the difference between Binance Options and Binance Futures?
Hedging with Binance Options
What are Binance Options?
Options traders deal with different variables than those who trade on the futures and spot markets. Options trading can be intimidating at times, especially to newcomers. The seemingly complex mechanics and dense financial jargon surrounding these financial instruments make options trading out of reach for many retail investors. In addition to the knowledge of the technical aspects of trading, options traders must understand how certain variables affect options’ prices.
How To Trade Binance Options
1. Open a Binance account: You will need to create an account on Binance if you don't already have one by completing verification.
2. Deposit funds: Once your account is created, you will need to deposit funds into your account. You can do this by clicking on the "Deposit" button and selecting your preferred payment method or using Binance P2P easiest method to fund your Binance account. For Example in Tanzania put the Currency TZS, then select a Verified merchant with a yellow tick, and click on "Buy" as seen in the following image 👇
3. Navigate to the options trading platform: Once your account is funded, navigate to the options trading platform. You can do this by clicking on the "Options" tab in the top menu bar.
4. Choose an option: Select the option that you want to trade. You can choose from a variety of options, including Call and Put options.
5. Set your trade parameters: Set your trade parameters, including the expiration date, strike price, and the amount you want to trade.
6. Place your trade: Once you have set your trade parameters, click on the "Buy" or "Sell" button to place your trade.
7. Monitor your trade: After placing your trade, monitor it closely to see how it performs. You may want to set stop-loss orders or take-profit orders to limit your losses or lock in profits.
It's important to note that options trading can be risky, so it's important to do your research and understand the risks involved before trading.
What are the USPs of Binance Options products?
Low fees: Binance offers some of the lowest fees in the industry for options trading, making it an attractive option for traders.
Wide range of options: Binance offers a wide range of options, including European and American style options, as well as a variety of strike prices and expiration dates.
User-friendly platform: Binance's options trading platform is designed to be user-friendly, with intuitive navigation and clear instructions.
Advanced trading tools: Binance offers advanced trading tools such as stop-loss orders, take-profit orders, and margin trading to help traders manage their risks and maximize their profits.
High liquidity: Binance's options market has high liquidity, which means that traders can easily buy and sell options at competitive prices.
Security: Binance has a strong reputation for security, with robust security measures in place to protect users' funds and personal information.
In summary; Binance Options product offers a comprehensive and user-friendly options trading experience with low fees, advanced trading tools, and high liquidity.
What is the difference between Binance Options and Binance Futures
Binance Options is a derivative product that allows traders to buy or sell options contracts, which give them the right (but not the obligation) to buy or sell an underlying asset at a predetermined price and time. Options trading is a more flexible and customizable way of trading than futures, as it allows traders to choose their own strike prices and expiration dates.
On the other hand, Binance Futures is a derivative product that allows traders to buy or sell futures contracts, which are agreements to buy or sell an underlying asset at a predetermined price and time in the future. Futures trading is more standardized than options trading, as the contracts have set expiration dates and contract sizes.
Rights and obligations
One of the primary differences between the two instruments is their method of execution. An options buyer has the choice not to exercise the contract if the market moves against their position. In contrast, a futures contract holder must execute the contract at expiry, regardless of the market conditions.
Cost structures
Options buyers have to pay an upfront fee, i.e., the premium, to the seller upon purchase. A futures contract allows you to open a position without paying any upfront fee. Importantly, you will likely have to pay some commissions including trading fees and funding rates for crypto futures depending on the exchange.
Time decay
Time decay refers to the decline in the value of an options contract as it nears the date of expiration. The time decay accelerates as the expiration date of a contract draws closer as there's less time to realize a profit. In the case of futures, the passage of time doesn’t adversely affect the valuation of the contract.
Potential risks
Since options traders have the choice not to exercise their contracts, their loss is constricted to the premium they have to pay for the contract. Buyers benefit as the maximum loss is capped at the fixed premium irrespective of how much the underlying asset moves. In contrast, futures contracts carry liquidation risks as leveraged positions are prone to volatile price swings and may deplete a trader's initial investment with little to no effort. Forced liquidation may happen when your wallet balance is unable to meet the margin requirements of your open position. These contracts are riskier because there’s no way to evaluate how much you’ll make or lose, which makes it challenging to hedge your risks.
In summary, the main difference between Binance Options and Binance Futures is the type of derivative product they offer and the level of flexibility and customization they provide to traders.
Hedging with Binance Options
One of the advantages of Binance Options is that it can be used as a hedging tool. Hedging is a risk management strategy that involves taking a position in a financial instrument that is opposite to an existing position to reduce or eliminate the risk of losses.
For example, if a trader holds a long position in a cryptocurrency and is concerned about potential price drops, they can buy a put option on Binance Options. A put option gives the trader the right to sell the underlying asset at a predetermined price (strike price) at a future date (expiration date). If the price of the asset drops below the strike price, the trader can exercise the option and sell the asset at the higher strike price, thus limiting their losses.
Similarly, if a trader holds a short position in a cryptocurrency and is concerned about potential price increases, they can buy a call option on Binance Options. A call option gives the trader the right to buy the underlying asset at a predetermined price (strike price) at a future date (expiration date). If the price of the asset increases above the strike price, the trader can exercise the option and buy the asset at the lower strike price, thus limiting their losses.
The General Opinion; Binance Options can be a useful tool for traders who want to manage their risks and protect their investments in volatile markets.
The Article is just informing you what other products are available in Binance Exchange, therefore not financial advice do your own research.
Reference:
https://www.binance.com/en/blog/futures/binance-options-understanding-options-prices-421499824684900544
https://www.binance.com/en/blog/futures/crypto-futures-and-options-what-are-the-similarities-and-differences-421499824684902074
https://www.binance.com/en/blog/futures/how-to-hedge-a-long-position-with-a-protective-put-135066415356006112
https://www.binance.com/en/eoptions-data/BTCUSDT
#BinanceTournament #futures #options
What are Binance Options?
How to trade Binance Options
What are the USPs of Binance Options products?
What is the difference between Binance Options and Binance Futures?
Hedging with Binance Options
What are Binance Options?
Options traders deal with different variables than those who trade on the futures and spot markets. Options trading can be intimidating at times, especially to newcomers. The seemingly complex mechanics and dense financial jargon surrounding these financial instruments make options trading out of reach for many retail investors. In addition to the knowledge of the technical aspects of trading, options traders must understand how certain variables affect options’ prices.
How To Trade Binance Options
1. Open a Binance account: You will need to create an account on Binance if you don't already have one by completing verification.
2. Deposit funds: Once your account is created, you will need to deposit funds into your account. You can do this by clicking on the "Deposit" button and selecting your preferred payment method or using Binance P2P easiest method to fund your Binance account. For Example in Tanzania put the Currency TZS, then select a Verified merchant with a yellow tick, and click on "Buy" as seen in the following image 👇
3. Navigate to the options trading platform: Once your account is funded, navigate to the options trading platform. You can do this by clicking on the "Options" tab in the top menu bar.
4. Choose an option: Select the option that you want to trade. You can choose from a variety of options, including Call and Put options.
5. Set your trade parameters: Set your trade parameters, including the expiration date, strike price, and the amount you want to trade.
6. Place your trade: Once you have set your trade parameters, click on the "Buy" or "Sell" button to place your trade.
7. Monitor your trade: After placing your trade, monitor it closely to see how it performs. You may want to set stop-loss orders or take-profit orders to limit your losses or lock in profits.
It's important to note that options trading can be risky, so it's important to do your research and understand the risks involved before trading.
What are the USPs of Binance Options products?
Low fees: Binance offers some of the lowest fees in the industry for options trading, making it an attractive option for traders.
Wide range of options: Binance offers a wide range of options, including European and American style options, as well as a variety of strike prices and expiration dates.
User-friendly platform: Binance's options trading platform is designed to be user-friendly, with intuitive navigation and clear instructions.
Advanced trading tools: Binance offers advanced trading tools such as stop-loss orders, take-profit orders, and margin trading to help traders manage their risks and maximize their profits.
High liquidity: Binance's options market has high liquidity, which means that traders can easily buy and sell options at competitive prices.
Security: Binance has a strong reputation for security, with robust security measures in place to protect users' funds and personal information.
In summary; Binance Options product offers a comprehensive and user-friendly options trading experience with low fees, advanced trading tools, and high liquidity.
What is the difference between Binance Options and Binance Futures
Binance Options is a derivative product that allows traders to buy or sell options contracts, which give them the right (but not the obligation) to buy or sell an underlying asset at a predetermined price and time. Options trading is a more flexible and customizable way of trading than futures, as it allows traders to choose their own strike prices and expiration dates.
On the other hand, Binance Futures is a derivative product that allows traders to buy or sell futures contracts, which are agreements to buy or sell an underlying asset at a predetermined price and time in the future. Futures trading is more standardized than options trading, as the contracts have set expiration dates and contract sizes.
Rights and obligations
One of the primary differences between the two instruments is their method of execution. An options buyer has the choice not to exercise the contract if the market moves against their position. In contrast, a futures contract holder must execute the contract at expiry, regardless of the market conditions.
Cost structures
Options buyers have to pay an upfront fee, i.e., the premium, to the seller upon purchase. A futures contract allows you to open a position without paying any upfront fee. Importantly, you will likely have to pay some commissions including trading fees and funding rates for crypto futures depending on the exchange.
Time decay
Time decay refers to the decline in the value of an options contract as it nears the date of expiration. The time decay accelerates as the expiration date of a contract draws closer as there's less time to realize a profit. In the case of futures, the passage of time doesn’t adversely affect the valuation of the contract.
Potential risks
Since options traders have the choice not to exercise their contracts, their loss is constricted to the premium they have to pay for the contract. Buyers benefit as the maximum loss is capped at the fixed premium irrespective of how much the underlying asset moves. In contrast, futures contracts carry liquidation risks as leveraged positions are prone to volatile price swings and may deplete a trader's initial investment with little to no effort. Forced liquidation may happen when your wallet balance is unable to meet the margin requirements of your open position. These contracts are riskier because there’s no way to evaluate how much you’ll make or lose, which makes it challenging to hedge your risks.
In summary, the main difference between Binance Options and Binance Futures is the type of derivative product they offer and the level of flexibility and customization they provide to traders.
Hedging with Binance Options
One of the advantages of Binance Options is that it can be used as a hedging tool. Hedging is a risk management strategy that involves taking a position in a financial instrument that is opposite to an existing position to reduce or eliminate the risk of losses.
For example, if a trader holds a long position in a cryptocurrency and is concerned about potential price drops, they can buy a put option on Binance Options. A put option gives the trader the right to sell the underlying asset at a predetermined price (strike price) at a future date (expiration date). If the price of the asset drops below the strike price, the trader can exercise the option and sell the asset at the higher strike price, thus limiting their losses.
Similarly, if a trader holds a short position in a cryptocurrency and is concerned about potential price increases, they can buy a call option on Binance Options. A call option gives the trader the right to buy the underlying asset at a predetermined price (strike price) at a future date (expiration date). If the price of the asset increases above the strike price, the trader can exercise the option and buy the asset at the lower strike price, thus limiting their losses.
The General Opinion; Binance Options can be a useful tool for traders who want to manage their risks and protect their investments in volatile markets.
The Article is just informing you what other products are available in Binance Exchange, therefore not financial advice do your own research.
Reference:
https://www.binance.com/en/blog/futures/binance-options-understanding-options-prices-421499824684900544
https://www.binance.com/en/blog/futures/crypto-futures-and-options-what-are-the-similarities-and-differences-421499824684902074
https://www.binance.com/en/blog/futures/how-to-hedge-a-long-position-with-a-protective-put-135066415356006112
https://www.binance.com/en/eoptions-data/BTCUSDT
#BinanceTournament #futures #options
Used Range Bound to short BTC's Vol last week, earn
🛑APR 480%.🚀🚀🚀
The research and investment of some option structured products will be updated in the future. #BTC #options #RangeBound
🛑APR 480%.🚀🚀🚀
The research and investment of some option structured products will be updated in the future. #BTC #options #RangeBound
LIVESober聊期权
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Talk about Binance’s options products Range Bound
Binance recently launched a product called Range Bound among its wealth management products, the link is as follows
https://www.binance.com/en/rangebound（English）
Product Entry
Product Revenue
Range Bound, this product means that the investors choose a date + an interval for wealth management. If the price does not jump out of range, the investors will get the corresponding income (the APR in the above picture is the annualized return). But once the price touch up or down point at any time, the product will be stopped immediately, and the investors' account will have a certain small losses (generally around 1-3%, depending on the length of time and the price width)
It supports both methods of stable coin and underlying coin (that is, the USD basis and crypto basis mentioned by options investors, the USD basis requires a longer expiration time, mainly based on liquidity consideration)
Compared with traditional wealth management and options, Range Bound has the following advantages:
1 (Key point) With the traditional options structure, the risk of the seller is unlimited. Especially for rookie options sellers, it is easy to oversell while shorting the volatility and lead to liquidation when encountering extreme market conditions. However, Range Bound makes the unlimited risk of the seller convert into limited risk of the buyer.
2 Compared with the Dual Investment, the Range Bound users will not cause short term losses due to selling the underlying asset too early. For example, during an extreme unilateral market condition, the price suddenly rises by 50% in half a month. The Dual Investment would convert investors’ coins into USD, causing the investors to miss large potential gains. On the other hand, the loss of the Range Bound investors is very limited, and it will not change whether the investors are a currency standard or a USD standard.
3 The Range Bound supports stable coins and BTC ETH (users can directly choose U standard or currency based options to short volatility), and investors will not change their overall position distribution when buying the Range Bound, which is safer than the Dual Investment. To avoid being forced to switch between USD and coin in a unilateral market, selling or buying too early. Compared with the Dual Investment, the Range Bound can take on more user positions.
4 The Range Bound belongs to high level wealth management in the traditional financial market, and the design of similar barrier options such as snowballs in the traditional market is relatively complicated. The Range Bound is designed based on DNT and support stable coins and underlying currencies, which is more flexible and convenient. Short, medium and long cycles can be selected according to the needs of the investors.
5 The income of the Range Bound is higher than the Dual Investment. As shown in the figures, as long as BTC price does not exceed 31,500, the annualized return of the Range Bound would be 30% higher than Dual Investment (of course, we should take the losing risk of Range Bound into consideration)
Dual Investment
Range Bound
6 The Range Bound can make investors pay more attention to the amplitude and fluctuation, rather than only the price. It can better break away from the idea of guessing the market rising or falling, improving investors' trading thinking.
To be fair, Range Bound is not a perfect product, and has the following shortcomings
1 For the investors, it is necessary to make a certain judgment on the market (because if the judgment is wrong, there will be a risk of a slight retracement of the principal ranging from 0.5% to 2%. Unlike the Dual Investment, One can comfort oneself by reducing or increasing underlying asset). The Range Bound is close to the R3 level products of the stock market, that is, there are small fluctuations, no large retracement, and no explosive growth in earnings. After all, there are always several big market touches the up or down point every year.
2 The income of the Range Bound has a greater relationship with market fluctuations, so when buying in a bear market, it will also suffer losses when it encounters a sharp drop.
3 At present, the Range Bound has not developed the options of ultra-long term and ultra-wide, and I believe it will be improved in the future.
Finally, let's take a look at the underlying design of the Range Bound
The Range Bound is essentially a kind of exotic option, but it is a relatively simple type. It is mainly generated based on the optimization of DNT options. Let's briefly introduce DNT options
DNT stands for "Double No Touch" In DNT options, investors need to set two barrier prices, an upper barrier and a lower barrier. If the price of the underlying asset has not touched the price range between these two barriers when the options expires, the option will be automatically exercised when the option expires, and investors will obtain fixed income; if the price of the underlying asset has touched If the price range between these two barriers is exceeded, the option will be invalidated automatically, and the investor will lose the premium paid when buying the option. (The amount of loss that the Range Bound was touched)
DNT is a relatively well understood exotic option, because the strategy looks like a short volatility investor + stop loss operation (while the crypto investment market lacks suitable short volatility products) double sell when the price breaks through When the price is close, the loss caused by the immediate stop loss (actually manifested as the loss of premium), but this series of operations is packaged into a buyer's product, and the loss is locked in, so as not to bear greater risks. Of course, as for the underlying design of this option, it is more complicated, we will not introduce it in detail, and the requirements for the designer's strategy + execution ability are relatively high. Because if the underlying optimization is unfavorable, the cost of the option will be too high (the user loss is too large after the touch, and the interval treasure is locked at around 2%. I believe that investors who have been options sellers know that this ratio is quite stable), Therefore, it is best to avoid small CEX for such products, otherwise, in extreme market conditions, the CEX may have the risk of Rug pull.
Article was written by Sober（❤️Follow me, focus on #Options ）
https://www.binance.com/en/rangebound（English）
Product Entry
Product Revenue
Range Bound, this product means that the investors choose a date + an interval for wealth management. If the price does not jump out of range, the investors will get the corresponding income (the APR in the above picture is the annualized return). But once the price touch up or down point at any time, the product will be stopped immediately, and the investors' account will have a certain small losses (generally around 1-3%, depending on the length of time and the price width)
It supports both methods of stable coin and underlying coin (that is, the USD basis and crypto basis mentioned by options investors, the USD basis requires a longer expiration time, mainly based on liquidity consideration)
Compared with traditional wealth management and options, Range Bound has the following advantages:
1 (Key point) With the traditional options structure, the risk of the seller is unlimited. Especially for rookie options sellers, it is easy to oversell while shorting the volatility and lead to liquidation when encountering extreme market conditions. However, Range Bound makes the unlimited risk of the seller convert into limited risk of the buyer.
2 Compared with the Dual Investment, the Range Bound users will not cause short term losses due to selling the underlying asset too early. For example, during an extreme unilateral market condition, the price suddenly rises by 50% in half a month. The Dual Investment would convert investors’ coins into USD, causing the investors to miss large potential gains. On the other hand, the loss of the Range Bound investors is very limited, and it will not change whether the investors are a currency standard or a USD standard.
3 The Range Bound supports stable coins and BTC ETH (users can directly choose U standard or currency based options to short volatility), and investors will not change their overall position distribution when buying the Range Bound, which is safer than the Dual Investment. To avoid being forced to switch between USD and coin in a unilateral market, selling or buying too early. Compared with the Dual Investment, the Range Bound can take on more user positions.
4 The Range Bound belongs to high level wealth management in the traditional financial market, and the design of similar barrier options such as snowballs in the traditional market is relatively complicated. The Range Bound is designed based on DNT and support stable coins and underlying currencies, which is more flexible and convenient. Short, medium and long cycles can be selected according to the needs of the investors.
5 The income of the Range Bound is higher than the Dual Investment. As shown in the figures, as long as BTC price does not exceed 31,500, the annualized return of the Range Bound would be 30% higher than Dual Investment (of course, we should take the losing risk of Range Bound into consideration)
Dual Investment
Range Bound
6 The Range Bound can make investors pay more attention to the amplitude and fluctuation, rather than only the price. It can better break away from the idea of guessing the market rising or falling, improving investors' trading thinking.
To be fair, Range Bound is not a perfect product, and has the following shortcomings
1 For the investors, it is necessary to make a certain judgment on the market (because if the judgment is wrong, there will be a risk of a slight retracement of the principal ranging from 0.5% to 2%. Unlike the Dual Investment, One can comfort oneself by reducing or increasing underlying asset). The Range Bound is close to the R3 level products of the stock market, that is, there are small fluctuations, no large retracement, and no explosive growth in earnings. After all, there are always several big market touches the up or down point every year.
2 The income of the Range Bound has a greater relationship with market fluctuations, so when buying in a bear market, it will also suffer losses when it encounters a sharp drop.
3 At present, the Range Bound has not developed the options of ultra-long term and ultra-wide, and I believe it will be improved in the future.
Finally, let's take a look at the underlying design of the Range Bound
The Range Bound is essentially a kind of exotic option, but it is a relatively simple type. It is mainly generated based on the optimization of DNT options. Let's briefly introduce DNT options
DNT stands for "Double No Touch" In DNT options, investors need to set two barrier prices, an upper barrier and a lower barrier. If the price of the underlying asset has not touched the price range between these two barriers when the options expires, the option will be automatically exercised when the option expires, and investors will obtain fixed income; if the price of the underlying asset has touched If the price range between these two barriers is exceeded, the option will be invalidated automatically, and the investor will lose the premium paid when buying the option. (The amount of loss that the Range Bound was touched)
DNT is a relatively well understood exotic option, because the strategy looks like a short volatility investor + stop loss operation (while the crypto investment market lacks suitable short volatility products) double sell when the price breaks through When the price is close, the loss caused by the immediate stop loss (actually manifested as the loss of premium), but this series of operations is packaged into a buyer's product, and the loss is locked in, so as not to bear greater risks. Of course, as for the underlying design of this option, it is more complicated, we will not introduce it in detail, and the requirements for the designer's strategy + execution ability are relatively high. Because if the underlying optimization is unfavorable, the cost of the option will be too high (the user loss is too large after the touch, and the interval treasure is locked at around 2%. I believe that investors who have been options sellers know that this ratio is quite stable), Therefore, it is best to avoid small CEX for such products, otherwise, in extreme market conditions, the CEX may have the risk of Rug pull.
Article was written by Sober（❤️Follow me, focus on #Options ）
