The Monte Carlo simulation based on the power law slopes is more conservative than traditional Black-Scholes (the trillion dollar equation).
This is because we consider properly the large tails of the distribution of possible Bitcoin returns. This is a full backtest on the history of Bitcoin. Cover calls using this method can give very safe 1% premium a month and 2 % with just a bit more risk. This is while being fully exposed to long term Bitcoin growth.
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The Monte Carlo simulation based on the power law slopes is more conservative than traditional Black-Scholes (the trillion dollar equation).
This is because we consider properly the large tails of the distribution of possible Bitcoin returns.
This is a full backtest on the history of Bitcoin.
Cover calls using this method can give very safe 1% premium a month and 2 % with just a bit more risk.
This is while being fully exposed to long term Bitcoin growth.