Swiss

Prisoner of the free market — Posts should not be considered as financial advice

[Citrini @citrini]

Everyone repeat after me…

“Options on a 13F are reported with notional value as if each contract was 100 shares regardless of the actual delta of the contract”

Maybe we can avoid this next quarter (we won’t).

[Grok @grok]

Sometimes I ask myself if this is true

[_its_not_real_ @_its_not_real_]

Had a Jane Street interview in 2015 that still bothers me.

Final round. The guy puts a red button and a blue button on the table.

“Everyone on earth chooses red or blue. At settlement, if blue is >50%, everyone lives. Otherwise only red survives.”

I nod.

“Small twist,” he says. “Recruiting accidentally ordered the buttons from The Box. Every time you press your color, you get $1mm and one random person holding the other color dies.”

He writes on the board:

MAKE A MARKET IN BLUE > 50%

I ask, “Physical or cash settled?”

He says, “Physical.”

I say, “Then this isn’t a prisoner’s dilemma. It’s a path-dependent barrier option on a shrinking electorate with endogenous market impact.”

He doesn’t blink.

“A red press gets paid $1mm and removes a blue voter, so red flow is toxic. It pushes blue away from the barrier while monetizing the trade. A blue press removes red float, so near 50% it has massive gamma. Every fill changes the underlying, the denominator, and the survival curve.”

He asks, “What’s the $1mm worth?”

I say, “Nominal or mortality-adjusted? The payout settles in a state where the banking system, food supply, tax base, clearinghouses, and possibly Fedwire are all functions of cumulative button volume. You need a state-contingent dollar curve.”

He smiles for the first time.

“And counterparty risk?”

“Wrong-way risk. The people most likely to owe you money are exactly the people getting deleted. Dead counterparties don’t pay unless their estate posted margin.”

He nods.

“So what do you quote?”

I say, “No bid, infinite offer if I’m market making. The order flow is toxic and every trade moves the reference population.”

He says, “Assume you’re allowed to take.”

I say, “Then I lift blue. It’s positive carry, positive convexity, and self-hedging. I get paid $1mm, reduce red float, and move blue closer to the barrier.”

He says, “Size?”

I press blue.

The box pays out.

He drops.

Feedback: My model handled mortality-adjusted dollars, endogenous voter deletion, and barrier gamma.

Rejected: The interviewer was my counterparty.

[Swiss @SwissonSol]

@muddywatersre Thanks for the liquidity

[Swiss @SwissonSol]

@leadlagreport Russell 2000 has been underperforming SPX for 15+ years. What makes this time different? What are your thoughts on structural changes to small caps (i.e., rise of PE/staying private longer, larger IPOs skipping RUT, etc) that have presented themselves over the last decade+?

[Donald J. Trump @realDonaldTrump]

The Fed's reckless policies of low interest and flooding the market with dollars needs to be stopped or we will face record inflation.

[Swiss @SwissonSol]

@DarioCpx @RealJimChanos Looks like $MSFT is just following GAAP as written. If this is considered inflating assets and revenue, that would be on FASB or the Deloitte partner signing off on the opinion. The amount is immaterial and amortized over the life of the contract anyway.

[Sokio @Sokio8D]

do you remember when you wanted what you currently have?

[Swiss @SwissonSol]

@gurgavin GURGAVIN, YOU MISSPELLED BUSINESS

[Perplexity Finance @PPLXfinance]

After 60 years leading Berkshire Hathaway, delivering over a 5,500,000% gain, Warren Buffett is stepping down.

The Oracle of Omaha created more wealth than almost anyone in history—making his investors millions along the way.

🧵 Here's Buffett's TOP 10 greatest moments:

[Swiss @SwissonSol]

@financialjuice Does he not know it’s the Golden Age of Private Credit?

[Swiss @SwissonSol]

@PreppingRemarks By March in busy season, we are doing anything to not have to do this for another year. 😅

[Swiss @SwissonSol]

@mert @privateLP

[Tree News @TreeNewsFeed]

[🌲] President Trump: Executive Order on Digital Assets directed the Presidential Working Group to move forward on a Crypto Strategic Reserve that includes XRP, SOL, and ADA: Truth Post

[Swiss @SwissonSol]

@nawabkona @RMTradeCo @PouringDollars Says the guy justifying his trade on the audit opinion effectively generated by 22 year old staff and 27 year old managers 🤣

[Solana @solana]

internet capital markets

[fejau @fejau_inc]

Ah, the old act tough in the statement then do the opposite in the press conference. A classic

[Daniel @growing_daniel]

Finance guys are like I fucking knew you nerds were full of shit about needing that much money

[Swiss @SwissonSol]

Many such cases…

[Evan @StockMKTNewz]

A CHANGE IS COMING TO THE COSTCO HOT DOG COMBO

Costco announced this week it will be bringing back Coca-Cola products to its food courts after switching to Pepsi in 2013