Experienced quant trader, based in London. Formerly a volunteer at Rethink Priorities, where I did some forecasting research. Interested in most things, donations have been primarily to longtermism, animal welfare and meta causes.
Charles Dillon šø
Karma: 1,508
Just had another glance at this and I think the delta vs implied vol piece is consistent with something other than a normal/ālog normal distribution. Consider: the price is $13 for the put, and the delta is 5. This implies something likeāthe option is expected to pay off a nonzero amount 5% of the time, but the average payoff when it does is $260 (despite the max payoff definitionally being 450). So it looks like this is really being priced as crash insurance, and the distribution is very non normal (i.e. circumstances where NVDA falls to that price means something weird has happened)
Generally I just wouldnāt trust numbers from Yahoo and think thatās the Occamās Razor explanation here.
Delta is the value I would use before anything else since the link to models of reality is so straightforward (stock moves $1 ā option moves $0.05 ā clearly thatās equivalent to making an extra dollar 5% of the time)
Right now the IV of June 2025 450 calls is 53.7, and of puts 50.9, per Bloomberg. Iāve no idea where your numbers are coming from, but someone is getting the calculation wrong or the input is garbage.
The spread in the above numbers is likely to do with illiquidity and bid ask spreads more than anything profound.
The IV for puts and calls at a given strike and expiry date will be identical, because one can trivially construct a put or a call from the other by trading stock, and the only frictions are the cost of carry.
The best proxy for probability an option will expire in the money is the delta of the option.
āNvidiaās implied volatility is about 60%, which means ā even assuming efficient markets ā it has about a 15% chance of falling more than 50% in a year.
And more speculatively, booms and busts seem more likely for stocks that have gone up a ton, and when new technologies are being introduced.ā
Do you think the people trading the options setting that implied volatility are unaware of this?
Seems like a rather vague collection of barely connected anecdotes haphazardly strung together.
I am not particularly concerned as I donāt see this persuading anybody.
Thanks for posting thisāon a quick read it looks pretty accurate to me and Iāll be glad to have this as a resource to point people to when they seem not to understand exactly why what FTX did was so bad.
I donāt understand why you think this is the case. If you think of the ādistribution of grants givenā as a sum of multiple different distributions (e.g. upskilling, events, and funding programmes) of significantly varying importance across cause areas, then more or less dropping the first two would give your overall distribution a very different shape.
I think getting enough people interested in working on animal welfare has not usually been the bottleneck, relative to money to directly deploy on projects, which tend to be larger.
Seems pretty unsurprisingāthe animal welfare fund is mostly giving to orgs, while the others give to small groups or individuals for upskilling/āoutreach frequently.
Type 1 diabetic and long time EA here.
Generally when I have donated to help people directly (most of my recent donations have not been of this form, to be clear, in recent years my donations have been focused on research or on helping animals) I am not really thinking about how big the problem is. I am thinking āwhat will the consequence of this donation be?ā If I am donating less than millions of dollars, Iām not likely to solve the whole issue, so the question of if the issue is big or small in a global sense just isnāt very important.
For type 1 diabetes, what can a donation of $5k do? Iām not sure, but the baseline for what I can do with $5k in the global health space is āprevent a child from dying of malariaā, so I would want to find something I thought was better than that before doing so.
That last bit is the key to the EA mindset to meāgiven a fixed donation budget, every time we choose to give to something, we are choosing not to give that money to everything else. So we ought to triage, and give to where we think the money or effort can do the most good.
For someone who knows of a really high leverage way to impact the affordability or availability of insulin (or for a researcher with a chance of discovering a cure or improved treatment), it might be that the best place for them to focus their efforts is on that. There are millions of type 1 diabetics, so any one person who could make a meaningful impact there could have enormous impact. But itās still good for them to ask the question and be aware of what other avenue to impact they might have, if their goal is to do the most good.
Did someone say it would be bad? Where?
I think the layout of this post is quite reader unfriendly.
I strongly suggest you start with a full summary rather than just an intro, and donāt bury your conclusions midway between the post and some very long appendices which are unlikely to be very useful to 90% of readers.
As it is, anyone wishing to respond in depth would basically have to do the work of summarizing the post themselves, which increases the friction on feedback.
The article gives a magnitude for fish farming. It does not talk about wild fish. Why is the scale of wild fish relevant?
Did you read the article? It is about intensive fish farming, and addresses all your points in detail, which you do not acknowledge.
It was less than 1 year ago, I would guess around 6 months ago.
This conceptually seems similar to the meat eater problem argument against global health interventions.
I think a lot of this coordination is implicit rather than explicit, and I donāt think itās very well publicised (and thereās room for marginal donations to change whether the org gets funded to their high Vs medium target for example, and signalling value that individuals think this is good, so I do not mean to say that this is the only consequence of a donation).
I think there is a misconception hereāwhen it is said that these charities will be fully funded anyway, what that can mean is that they will try to fundraise for a certain budget (perhaps with high/āmedium/ālow targets) and larger donors will often choose to fill the remaining gap in their fundraising late in the fundraising process.
This means you are often not really giving the charity extra on top of their budget, but in practice funging with the largest donors. The largest donors will then often give slightly less to them and give to their next best option instead.
As an individual, you are in this case redirecting funding from an organisation which agree with your priorities to whatever their next best option is.
For example, I personally made some donations to animal welfare charities this year which very likely funged to some extent with the EA Funds animal welfare fund. What that means is that the counterfactual effectiveness of my donation might be equivalent to whatever the last thing they chose to fund was (which I think is probably quite good in expectation).
I think if there were proven methods to persuade such people to give away the excess, the world would look very different.
I hope you find success in persuading those around you to give, but I donāt think the process of giving to neighbours and polling resources rather than going directly to supporting specific causes where they could have a lot of impact makes much sense.