Because trading cannot only consider the profit-loss ratio, but also the winning rate.

I remember that a researcher from a futures company conducted an analysis based on option data. In the end, the buyer’s winning rate at expiration was less than 20%, and the seller’s probability of making a profit and leaving the market was 80%.

This data is taken from external futures exchanges. In fact, the winning rate of sellers in domestic exchanges can even reach 90%.

The buyer is like buying a lottery ticket. The minimum loss is 2 yuan and the maximum win is 5 million. Does this mean limited losses and unlimited gains?

Then do you think the probability of winning a lottery ticket is so great that you can get up tomorrow and quit your job?

The seller is like an insurance company selling insurance. The ability to execute the insurance is very low, so the insurance company relies on the policyholders' money to make profits.

If the policyholder needs to execute the policy, it doesn’t matter

The profits I made from other unexecuted policies can also hedge against the risks of executing the policy.

This is why sellers are active in major option strategy private equity institutions.

An annualized return of 15% and a drawdown of about 4%. Such a good option strategy is most likely to be favored by big funds such as FOF, asset management and risk management.