I have several questions and they're kinda all over the place haha. I appreciate any time you can give to answer as many as you are able. I understand some are large questions and basically asking for another newsletter.
1.
How do MMs make money if they're usually short, and S&P usually rises?
2.
"If the market does not sell-off, then the large vanna and charm flows of March OpEx take over and it’ll be a monstrous tide that will skyrocket the market."
Would this be indicated by lower than normal trade volume that slowly rises into Mar Opex?
I'm taking the understanding that these Vanna & Charm trades are an undercurrent of trade volume that always exist (so long as these big investors want "insurance"). Then the "window of weakness" would refer to an absence of us everyday retail traders, right?
3.
The put/call ratio looks much more even for Mar OpEx compared to Feb OpEx of 2.84:1. How does that affect the price direction?
4.
Where can I get access to charts like the ones you shared?
5.
I'm lost on how the potential liquidity crunch (ON RRP depletion) ties into this. I'm reading your "Market Pulse: Liquidity is Surging" newsletter as I write this, but my understanding of Bank Reserves, US Treasuries and how that influences MM and other major retail investors is lacking.
I trust the general concept that it means a depletion of liquidity, and depletion of liquidity means they bow out of the market - but I do not fully understand the motivation/decisions that would be made by Institutions. I'll re-read and find supplemental info to see if that sparks an understanding.
6.
On that same note, your other newsletter "The Banking System was Redesigned" explains that the Fed has gone from manipulating interest rates as a means to control liquidity, to now they directly control liquidity with Ample Reserves (infinite money). This sounds like the impending liquidity crunch would dictate the Fed initiates QE again, and thus is a non-issue? Like isn't that the exact scenario that Ample Reserves is meant to tackle?
I have several questions and they're kinda all over the place haha. I appreciate any time you can give to answer as many as you are able. I understand some are large questions and basically asking for another newsletter.
1.
How do MMs make money if they're usually short, and S&P usually rises?
2.
"If the market does not sell-off, then the large vanna and charm flows of March OpEx take over and it’ll be a monstrous tide that will skyrocket the market."
Would this be indicated by lower than normal trade volume that slowly rises into Mar Opex?
I'm taking the understanding that these Vanna & Charm trades are an undercurrent of trade volume that always exist (so long as these big investors want "insurance"). Then the "window of weakness" would refer to an absence of us everyday retail traders, right?
3.
The put/call ratio looks much more even for Mar OpEx compared to Feb OpEx of 2.84:1. How does that affect the price direction?
4.
Where can I get access to charts like the ones you shared?
5.
I'm lost on how the potential liquidity crunch (ON RRP depletion) ties into this. I'm reading your "Market Pulse: Liquidity is Surging" newsletter as I write this, but my understanding of Bank Reserves, US Treasuries and how that influences MM and other major retail investors is lacking.
I trust the general concept that it means a depletion of liquidity, and depletion of liquidity means they bow out of the market - but I do not fully understand the motivation/decisions that would be made by Institutions. I'll re-read and find supplemental info to see if that sparks an understanding.
6.
On that same note, your other newsletter "The Banking System was Redesigned" explains that the Fed has gone from manipulating interest rates as a means to control liquidity, to now they directly control liquidity with Ample Reserves (infinite money). This sounds like the impending liquidity crunch would dictate the Fed initiates QE again, and thus is a non-issue? Like isn't that the exact scenario that Ample Reserves is meant to tackle?