SPX is an index fund that tracks the SP500. Right now SPX is worth about 6100 per share. For individual stocks, even the large ones, you can usually only buy options through Dec 2027. However SPX has options that expire in Dec 2028 / 29 / 30[1]. Such options with strike prices of 10K, 11K, or 12K seem extremely lucrative to me. Max dated SPY calls are also a good option. The obvious motivation is AI progress. But the naive analysis suggests these are a good way to get exposure to something we want anyway.

Current prices look like this: A very rough summary of the price curve is as follows: Each 1K step halves the price. Moving forward one year halves the price.

I looked at the SP 500's cumulative returns over every 3/4/5/6 year period from 1927 to 2024. There are 91 such six-year periods [...]

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First published:
January 23rd, 2025

Source:
https://www.lesswrong.com/posts/JotRZdWyAGnhjRAHt/tail-sp-500-call-options

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“Tail SP 500 Call Options” by sapphire

LessWrong (30+ Karma)