Aug 27, 2023
Derek Moore is joined by Jay Pestrichelli, CEO of ZEGA Financial, to discuss the Bank of America piece saying maybe Goldman Sachs got 0 DTE option effects wrong. Plus, what did Jay Powell’s speech mean if anything? New Fed Funds futures probabilities point to the Fed raising yet again. Then, they go through some odds and ends like how participation in employment surveys is dropping, the high Atlanta Fed GDP now numbers, and more.
The Fed on track for more interest rate hikes?
Jay Powell will do what needs to be done!
Fed Funds futures probabilities
What are 0 DTE Options?
Bank of America says 0 DTE options were not the cause of a late-day market drop.
Explaining how market makers hedge based on delta.
Interest rates and the cost of carry in option prices
Small discussion on what option Gamma is.
Liquidity in the options market
What is the Atlanta Fed GDP Now indicator?
Surprising Q3 GDP Now reading over 5.7%
What is the establishment employment survey?
Dropping participation rate of the unemployment surveys
Mentioned in this Episode:
Bank of America Disputes Goldman Logic on Zero-Day Option Threat to Stocks https://finance.yahoo.com/news/bank-america-disputes-goldman-logic-185606310.html
S&P 500 Forward PE Valuations vs Future Returns | Volatility in Stock & Option Markets https://podcasts.apple.com/us/podcast/s-p-500-forward-pe-valuations-vs-future-returns-volatility/id1432836154?i=1000624302870
Everyone Wrong on Interest Rates and what Fed Funds Probabilities Mean
Fed Funds CME probability tracker tool https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html
Jay Pestrichelli’s book Buy and Hedge https://amzn.to/3jQYgMt
Derek’s new book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag
Derek Moore’s book Broken Pie Chart https://www.amazon.com/Broken-Pie-Chart-Investment-Portfolio/dp/1787435547/ref=sr_1_1?keywords=broken+pie+chart&qid=1558722226&s=books&sr=1-1-catcorr
Contact Derek derek.moore@zegafinancial.com