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Delta Hedging

 Liquid options markets will have very liquid underlying markets. The options traders will be chasing prices. When stock prices go up, options traders will have to keep buying, because they are trying to delta hedge. This moves the market against them. Options traders make all their profit when the contract is sold. All remaining actions are to ring-fence this profit, not to make new money. An excellent lecture on delta hedging may be found here: http://people.stern.nyu.edu/jhasbrou/Teaching/POST%20Draft%20syllabus/powerpoints/H3.pdf