when market is open there is no difference between spy and futures... you can’t be saying that all the price discovery happens overnight!
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Replying to @mpp75214 @FREAK0NAUT and
I’m saying the the futures lead the etf intraday (at HFT timescales) because they are the more liquid market.
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Replying to @macrocephalopod @mpp75214 and
i had heard spy was more liquid that futures. (obviously.. i know nothing.)
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Replying to @FREAK0NAUT @macrocephalopod and
fairly sure that spy during market hours is more liquid than futures in the middle of the night
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Replying to @mpp75214 @macrocephalopod and
why are not comparing during the day to middle of the night we're comparing middle of the night to nothing. /ES certainly more liquid than spy when SPY is not trading at all.
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Replying to @FREAK0NAUT @macrocephalopod and
well by this analogy why not just hedge aapl option positions with jpy overnight... the point is that in situations when overnight prices aren’t reliable indicators of actual pricing in normal market hours then may not be optimal to base trading decisions on such
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Replying to @mpp75214 @FREAK0NAUT and
I mean if you face risk constraints and *have* to hedge sure. but if not then why (if you think futs untethered from actual spy price)? it’s like if you face risk constraints then sure close your gme short at 500, but if not then probably better remain unhedged
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Replying to @mpp75214 @macrocephalopod and
they make money hedging! and it reduces risk. why wouldn't you hedge?
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Replying to @FREAK0NAUT @macrocephalopod and
If you’re short gamma you lose money hedging. yes it reduces risk, but only if there is reliable relationship between your exposure and the hedging instrument.
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Replying to @mpp75214 @FREAK0NAUT and
The idea that short gamma makes money hedging & long gamma loses money hedging is... I mean, it's not right. Long gamma makes money on hedges if realized vol is greater than implied. Short gamma makes money if implied vol is greater. Ignoring IV changes, it's all theta vs gamma.
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OK I am definitely doing a "someone is wrong on the internet" so I'm going to go to bed :/
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