Two Quants and a Financial Planner

Practical Lessons from Cem Karsan | Inside the Hidden Forces Moving Markets

12 snips
Feb 17, 2025
Cem Karsan, an insightful options trader, shares his expertise on the hidden forces driving markets. He emphasizes the fundamental roles of supply, demand, and liquidity, stating why these elements are crucial for effective investing. Karsan discusses the importance of probabilistic thinking and how different timeframes impact market dynamics. He also explores the significant influence of options trading on volatility and offers intriguing perspectives on election year market trends. Listeners gain valuable frameworks for navigating risk and enhancing investment strategies.
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INSIGHT

Liquidity's Importance

  • Liquidity is crucial; it can create demand or remove it, impacting investments.
  • Consider your position's liquidity and the available money to fund supply.
INSIGHT

Probabilistic Thinking

  • Options represent the full distribution of asset outcome probabilities, not just binary up/down.
  • Think probabilistically, considering various outcomes and their likelihoods for better decisions.
ADVICE

Assess Probabilities

  • Consider probabilities even with high conviction, asking "what are the odds?"
  • Understand potential downsides, even if improbable, and prepare for various outcomes.
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