ARTICLE SYNOPSIS...Trading volatility by Andrew Sterge In the winter and spring of 1989, I made a series of Eurodollar options trades which show the logic of ""trading volatility."" This sort of trading is the bread and butter of many institutional traders, that is to say
ARTICLE SYNOPSIS...Volatility skews by Andrew Sterge It is inevitable that relative mispricings occur among many different options on a single underlying instrument. It is possible to exploit these mispricings using the Black-Scholes theory of option valuation, despite ri