The volatility edge in options trading, Jeff Augen


2 0
Hi, I am reading the book, and I have a question. In chapter 3, page 68, Jeff states that aapl options are overpriced, and that a good trade would be to sell puts, to pay
for long call positions on the stock. Under that, he says that the options would can't
be correctly priced, because this would create an arbitrage opportunity to sell puts,
buy calls, short the stock and long bonds.

My questions is, if the puts are overpriced isn't the trade given as an arbitrage be
better priced? why are the puts still overpriced if such an opportunity exists??

Thanks for your time and answers.
AdBlock Detected

We get it, advertisements are annoying!

But it's thanks to our sponsors that access to Trade2Win remains free for all. By viewing our ads you help us pay our bills, so please support the site and disable your AdBlocker.

I've Disabled AdBlock