Black-Scholes-Merton Model

sometimes very complicated model demine us . Here’s a simplified visual that turns a complicated model into something intuitive and easy to follow. Hope it helps everyone or some people and happy trading .

The picture is AI generated using Gemini with prompts and it make understanding when to sell which a lot of people want to know . So I hope this chart is useful to you all.

In summary , the diagram uses a simple color-coded system to illustrate volatility:

1 Standard Deviation (68.2% probability): Indicates that the asset price is stable, suggesting you should HOLD.

2 Standard Deviations (95.4% probability): Indicates moderate volatility, signaling you should CONSIDER SELLING.

3 Standard Deviations (99.7% probability): Indicates extreme price volatility, signaling a strong SELL or ACTION position.

Happy Hari Raya Haji to all Muslim friends !

@Shyon here's dedicated to u for introducing how to make nice graphics

Modified in.05-29

How to pick strike prices for options?

Picking strike price that's aligned with your strategy is a critical component of one's options trading. When selecting a strike price, it is important to consider the current market conditions, the underlying asset's price movement, and your investment objectives. ---------------------- How do you pick strike prices? What tips or strategies do you use? Have you made any mistakes or learned any lessons from it? What were your most successful and unsuccessful experiences in picking strike prices?

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

e13v3n
05-27
e13v3n
How does the 3 standard deviation correspond to 99.7 probability?
- BillionaireN:
  Formulae for
  Referencing
Shyon
05-29
Shyon
Thanks for sharing, glad that you able to generate such a great graphic, bravo!
- ShyonReplyBillionaireN:
  [Cool] [Cool] [Cool]
- BillionaireN:
  Kudos to u
BillionaireN
05-27
BillionaireN
Formulae as such

Leave a comment

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Hope it helps everyone or some people and happy trading .\nThe picture is AI generated using Gemini with prompts and it make understanding when to sell which a lot of people want to know . So I hope this chart is useful to you all.\nIn summary , the&nbsp;diagram uses a simple color-coded system to illustrate volatility:\n1 Standard Deviation (68.2% probability): Indicates that the asset price is stable, suggesting you should HOLD.\n2 Standard Deviations (95.4% probability): Indicates moderate volatility, signaling you should CONSIDER SELLING.\n3 Standard Deviations (99.7% probability): Indicates extreme price volatility, signaling a strong SELL or ACTION position.\nHappy Hari Raya Haji to all Muslim friends !\n \n<a href=\"https://ttm.financial/U/3581734406950755\">@Shyon</a> here's dedicated to u for introducing how to &nbsp;make nice graphics&nbsp;</body></html>","htmlText":"<html><head></head><body>Jo\n<img src=\"https://community-static.tradeup.com/news/4d57055a0b98b82531900635090f81db\" tg-width=\"1408\" tg-height=\"768\">\nsometimes very complicated model demine us . Here’s a simplified visual that turns a complicated model into something intuitive and easy to follow. Hope it helps everyone or some people and happy trading .\nThe picture is AI generated using Gemini with prompts and it make understanding when to sell which a lot of people want to know . 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[Cool] [Cool]","text":"[Cool] [Cool] [Cool]","html":"[Cool] [Cool] [Cool]","disclaimerType":0},{"id":569589995671888,"commentId":"569589995671888","gmtCreate":1780066265091,"gmtModify":1780066270371,"authorId":3554449592029615,"author":{"id":3554449592029615,"idStr":"3554449592029615","authorId":3554449592029615,"name":"BillionaireN","avatar":"https://community-static.tradeup.com/news/285e4ef21515e874f0dc6d5f7d1a2834","vip":2,"crmLevel":13,"crmLevelSwitch":1,"individualDisplayBadges":[],"wearingBadges":[]},"repliedAuthorId":0,"objectId":568576944215200,"objectIdStr":"568576944215200","type":1,"supId":569405097178128,"supIdStr":"569405097178128","prevId":0,"prevIdStr":"0","content":"Kudos to u","text":"Kudos to u","html":"Kudos to u","disclaimerType":0}],"verified":10,"allocateAmount":0,"commentType":"hot","coins":0,"score":0,"disclaimerType":0},{"id":568888670568712,"commentId":"568888670568712","gmtCreate":1779895043062,"gmtModify":1779895284769,"authorId":3554449592029615,"author":{"id":3554449592029615,"idStr":"3554449592029615","authorId":3554449592029615,"name":"BillionaireN","avatar":"https://community-static.tradeup.com/news/285e4ef21515e874f0dc6d5f7d1a2834","vip":2,"crmLevel":13,"crmLevelSwitch":1,"individualDisplayBadges":[],"wearingBadges":[]},"repliedAuthorId":0,"objectId":568576944215200,"objectIdStr":"568576944215200","type":1,"supId":0,"supIdStr":"0","prevId":0,"prevIdStr":"0","content":"Formulae as such <t-t type=\"img\" src=\"https://community-static.tradeup.com/news/ff9d83668d05254e8358ddeb34ecf934\"></t-t>","text":"Formulae as such <t-t type=\"img\" src=\"https://community-static.tradeup.com/news/ff9d83668d05254e8358ddeb34ecf934\"></t-t>","html":"Formulae as such <t-t type=\"img\" 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