1. - No Escape This Week?

01/15/2021 UK closing ALL travel

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Which metric is a better predictor of the severity of the fall surge in US states?

1) Margin of Democrat victory in Nov 2020 election
or
2) % infected through Sep 1, 2020

Can you guess which plot is which?


The left plot is based on the % infected through Sep 1, 2020. You can see that there is very little correlation with the % infected since Sep 1.

However, there is a *strong* correlation when using the margin of Biden's victory (right).

Infections % from
https://t.co/WcXlfxv3Ah.


This is the strongest single variable I've seen in being able to explain the severity of this most recent wave in each state.

Not past infections / existing immunity, population density, racial makeup, latitude / weather / humidity, etc.

But political lean.

One can argue that states that lean Democrat are more likely to implement restrictions/mandates.

This is valid, so we test this by using the Government Stringency Index made by @UniofOxford.

We also see a correlation, but it's weaker (R^2=0.36 vs 0.50).

https://t.co/BxBBKwW6ta


To avoid look-ahead bias/confounding variables, here is the same analysis but using 2016 margin of victory as the predictor. Similar results.

This basically says that 2016 election results is a better predictor of the severity of the fall wave than intervention levels in 2020!

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A THREAD ON @SarangSood

Decoded his way of analysis/logics for everyone to easily understand.

Have covered:
1. Analysis of volatility, how to foresee/signs.
2. Workbook
3. When to sell options
4. Diff category of days
5. How movement of option prices tell us what will happen

1. Keeps following volatility super closely.

Makes 7-8 different strategies to give him a sense of what's going on.

Whichever gives highest profit he trades in.


2. Theta falls when market moves.
Falls where market is headed towards not on our original position.


3. If you're an options seller then sell only when volatility is dropping, there is a high probability of you making the right trade and getting profit as a result

He believes in a market operator, if market mover sells volatility Sarang Sir joins him.


4. Theta decay vs Fall in vega

Sell when Vega is falling rather than for theta decay. You won't be trapped and higher probability of making profit.