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Black-Scholes assumes constant volatility, but real markets don't. This article explores how market makers model and trade the implied volatility surface.
Jane Street, Optiver, and Citadel, on what separates a strong quant candidate from a prepared one A look inside the quant interview process at top firms, covering how each weighs probabilistic intuition, risk awareness, and the reasoning habits that make candidates stand out.
The Merton jump-diffusion model extends GBM by adding sudden price jumps, capturing the discontinuous market repricing that continuous models cannot produce.
The Law of Large Numbers shows why small backtests deceive traders. Short-term results are unreliable due to noise, and extensive testing is essential.
Vincent Vis, options trader and former market maker at Optiver and IMC Trading, broke down how markets actually work in practice — from trading philosophies and risk management to volatility and the moments when models break down, at AQS's recent Options Deep Dive event.
The Law of Large Numbers shows why small backtests deceive traders. Short-term results are unreliable due to noise, and extensive testing is essential.
