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Re:The Trillion Dollar Equation [video] by ironSkillet on Sunday March 03, 2024 @04:44PM (#39584804)
In a way, yes. A lot of money follows these standard formulas for pricing which do not necessarily reflect accurate probabilities of the underlier price movement. After an idiosyncratic price shock (disappointing earnings, geopolitical news etc), people blindly following a trailing 1 month volatility or something will misprice the option as volatility reverts back to the mean. This probably has been arbed away to a large extent by trading algorithms.

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