Excess Returns A Volatility Masterclass | Timeless Lessons from 30 Year Options Trader Noel Smith
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Oct 2, 2025 
In a fascinating discussion, Noel Smith, co-founder and CIO of Convex Asset Management, shares his unique journey from biochemistry and military service to becoming a volatility trading expert. He explains why volatility is the best market informant, its role in regime shift models, and the strategic use of options for income. Noel delves into dynamic put-spread strategies, the impact of zero DTE options, and the nuances of dispersion trading. His insights on tail hedging and the importance of adapting quickly in trading provide invaluable lessons for investors.
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Unusual Career Path Informs Trading Edge
- Noel ties his biochemistry and military experience to trading through signals and communication systems.
- He traces a path from CBOE pit market making to backing early HFT firm Getco and later launching a hedge fund.
Liquidity And Information Are Transformed
- Markets now have far tighter spreads and vastly easier access to data than in the 1990s.
- Noel says commoditization removed many old edges but also makes scaling and execution easier.
Volatility As A Superior Information Source
- Convex uses volatility as primary information because options contain leverage and forward-looking signals.
- Noel argues options markets often show higher quality, actionable views than lagging macro data.