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SateliteDicPic t1_iu97z3w wrote

Reply to comment by Stunning-Leek334 in Someone suffers on the other side of your bet by [deleted]

Options and stocks trading are different. Options ARE zero sum but the OPs presentation of the situation is an over simplification regardless.

I do agree with the spirit of the post in as much as some human decency isn’t a bad thing I just think the attempt to apply it here isn’t ideal.

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Stunning-Leek334 t1_iu99acb wrote

It literally is not zero sum though? AN ASPECT of options trading can be zero sum. The premium I charge you for an option is a zero sum. I get that and you lose it. If I don’t cover then you could also potentially consider that part of it zero sum. If I do cover it is not zero sum. Also, even if I didn’t cover, if you exercised the option then when the stocks change hands there is a zero sum transaction.

If the stock market was zero sum then the stock market would never go up or down. Companies enter and exit, mergers happen, etc there are so many aspects of the stock market that make it not zero sum.

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