The RoToR Payoff Diagram®: Distinguishing what’s probable from what’s possible (IFTA Conference Presentation)

Saturday 14th October. 5:45 PM

The RoToR Payoff Diagram® addresses the following key deficiencies inherent in the traditional payoff diagram.

1) Market Outlook - It allows the Technical Analyst a means of reconciling the historical price action of the underlying instrument and any inferences that (s)he may have on the future direction and momentum of the trade, with a quick visual guide to the zone(s) of prices necessary for a profitable options strategy trade.

2) Market Volatility - It allows the Technical Analyst to make an assessment about the underlying instrument’s historical volatility and trend in terms of a suitable options strategy.

3) Likely Outcomes - Using the Volume At Price technical indicator as the basis for the probability distribution function (pdf) of the Underlying Instrument’s future price, the Expected Monetary Value allows for the direct comparison of various options strategies, so that a strategy with limited risk and unlimited profit can be usefully compared against a strategy that has limited risk and limited profit.

The presentation will describe the key attributes of the RoToR Payoff Diagram® and highlight future developments.

Further information: IFTA 2017