Probability Distributions of EDZ8
[Below is a Trade Thought essay that discusses a real-world application of the options article I wrote for the CME] This will probably be a multi-part series. This week, I wanted to discuss the pricing of the front options flies. Clearly from the FFV8 pricing and lack of movement, the markets just do not think the Fed is going to skip in two months. We can easily cover the skip scenario by buying FFV8. We should wait until the August meeting has passed in a few days. I also don’t think the Fed is going to hike more than once a [...]