davidfielder
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Most people don't understand the "updated" forex/futures regs in the past few years does nothing to protect traders or fx only type brokers. They were done to stop money moving out of the US futures industry. Retail traders were bent over and given an enema.
Peter
Slept half way through. Please construct a vanilla option model for the following scenario
1. WiseButtHair Options has 1000 customers.
2. On Monday a big market news is about to come.
3. The first 500 customers bet $100 each and the return for the correct direction would water their pockets with $1000 each.
4. The remaining 500 customers do not choose to bet and waste their time watching the lame episodes of "Two and Half Men" on their Ipads instead.
5. Bang! all 500 customers are right. Broker now owes $500,000 to the 500 customers while it managed to steal only $50,000 off of them.
6. How is the broker now going to pay up $450,000? Stewie Griffin wanted to extract money off of Brain!
7. Note this is just Monday and one fanatical news event.
Using your brilliant mathematical skills, please generate the magical formula that protects the bank accounts of the brokers.
Please also smooth out the exotic details of the party taking this risk on the other end with "Binary Options" gambling product.
If you cannot figure out the correct answer, watch the video below
Australian idiot talks about whale death FUNNY - YouTube
Very simple: your damn MATH is wrong: OH SO WRONG IT HURTS
If 500 people Bet $100 then the payout (even with a stupid 100% option payout) is still 50,000!!! You think a broker gives a rat's ass about losing 50k in a minute? Haha - boy - you're in lala land
You are mistaken