So when GME was trading at $300, what was the $330 call premium? And how do you come up what you call the “option value” on that call?
I use at-the-money options as my premium benchmark, because at-the-money premiums for puts and calls are almost equal.
During those three or four days of insane prices, the premium for a 300 at-the-money call option for the nearest expiration date was consistently in the range of 60% - or $180.
A 330 strike premium would have been less, but not 10% less.
The further you moved out on the expiration date, the higher the premium, up to 80% of the strike in some cases.
Bottom Line...
By 25 January, every option market maker in the world could see the Cat 5 storm coming.
NONE of them were selling short insurance to the hedge funds - except for a king's ransom.