Thanks. Please pardon my ignorance. So the person doing this loses nothing either way? He’s just put money up for the right to do something and if he chooses not do do it, or the market doesn’t fall, he loses nothing? Unless he loses if this doesn’t happen (market crash), then I don’t see why this is such a big deal.
no, the options cost something to enter into (otherwise everyone would bet on everything)...so if the options expire worthless (i.e. the market does not fall 50%), then according to the article this particular trade will lose about 1 billion dollars
The call buyer is out the money he spent to purchase the option if he does nothing else.
If this is not a hoax, it is likely the other side of a hedging strategy.