r/wallstreetbets • u/DegenOptionGuy 💎Diamond Testicles💎 • 1d ago

Gain 27k -> $765k BABA $125p 4/4

Enable HLS to view with audio, or disable this notification

3.0k Upvotes

98% Upvoted

348 comments sorted by

View all comments

Show parent comments

37

u/da_crackler 20h ago

I feel like you got lucky with the fill

163

u/DegenOptionGuy 💎Diamond Testicles💎 20h ago

It actually topped out at like 11-12 I left like 250k on the table

18

u/Anal_Recidivist 20h ago

I’ve been working up the knowledge on this stuff and understand the concept of calls/puts, how the calculation works, etc.

But when you sold your puts, who bought them? Investors/funds or sold back to market like any stock?

244

u/DegenOptionGuy 💎Diamond Testicles💎 20h ago

Who cares?

4

u/Anal_Recidivist 15h ago

So another party physically had to buy these?

You couldn’t just sell them like a normal stock if they hadn’t bought them?

5

u/Codicus1212 898C - 0S - 4 years - 1/6 13h ago

There are open bids on hold with brokerages. The broker matches the seller with the buyer. The black scholes model is used to price contracts, but sellers can offer and buyers can bid for whatever price they want. On crazy volatile days like today (when the VIX skyrockets) these options have crazy high IV “Implied Volatility” that skyrockets the price of an option based upon the implied (think possible) move the stock could make.

Unless you’re selling thousands of options in something people don’t trade much, or if you’re price is too aligned with market consensus, you’re not going to experience any problems selling. Someone somewhere is going to buy them.

3

u/balls2hairy 11h ago

"normal stocks" are being bought by "the market". Market makers are there for liquidity if need be but you could be selling your 2 shares of Walmart to Warren Buffett or your neighborhood pedo. Doesn't matter so long as it gets filled.