Wall Street Raider

// mechanics · derivatives

Options are priced, not looked up.

The quickest way to tell whether a trading game respects you is to open its options chain. If the premiums are a fixed percentage of the strike distance, the whole thing is decoration. Here every contract is priced with Black–Scholes on every tick, which means the chain behaves the way a chain behaves — including in the ways that will cost you money.

What that actually means at the chain

Five inputs determine a premium: the underlying price, the strike, time to expiry, volatility, and the risk-free rate. All five are live values in the simulation rather than constants, and all five move.

Things that follow, which you can observe directly in-game:

• Time decay is real and accelerating. A position that is right about direction but early still loses. Theta is not linear — the last stretch before expiry bleeds fastest.
• Volatility is priced, so calm is expensive to buy and a crisis is expensive to insure. Buying protection after the sector has already broken costs a multiple of what it cost the week before. This is the single most common way players lose money on options here, and it is not a bug.
• The risk-free rate matters. Because the macro layer moves the yield curve, a rate cycle genuinely re-prices the chain — calls and puts in opposite directions.
• Deep out-of-the-money is cheap for a reason. The premium reflects a real probability, not a discount.

The Greeks are exposed, and they are the point

Delta, gamma, theta, vega and rho are shown per position and aggregated across your book. They are not a stats readout — they are the interface for the only question that matters when you hold several positions at once: what is this portfolio actually exposed to?

Greek	Reads as	Why you care
Delta	Directional exposure, in share-equivalents	Tells you whether you are long or short the market despite holding only options
Gamma	How fast delta changes	High gamma near expiry is why a "small" position becomes a large one overnight
Theta	Daily cost of holding	The rent you pay for being early
Vega	Sensitivity to volatility	You can be right on direction and lose because volatility collapsed
Rho	Sensitivity to rates	Matters when the macro layer starts a hiking or cutting cycle

Multi-leg strategies carry real margin

Spreads, straddles, strangles, condors and the rest are built as single strategy objects rather than loose legs you have to hand-manage. Each is margined according to its actual maximum loss — a defined-risk vertical spread ties up far less capital than a naked short option, because its worst case genuinely is bounded.

That margin is held, not notional. It reduces the buying power available for everything else you might want to do, which is what makes strategy selection a portfolio decision instead of a menu choice.

What happens when the underlying gets acquired

This is the corner case that separates a modelled derivatives system from a decorative one, and it comes up constantly in a game about takeovers.

When a company is acquired or delisted, contracts written on it cannot simply be orphaned. Every open single-leg option settles at the moment of delisting, and every open multi-leg strategy referencing that underlying settles too — releasing the margin it was holding. If only the single legs settled, a spread would sit open forever with your capital trapped inside a position on a company that no longer exists.

Market plumbing that touches the chain

Options do not sit in a vacuum. The underlying trades on an order book with real depth, so a large order walks the ladder and pays impact rather than filling at a single mid price. Volatility halts and short-sale restrictions apply on sharp moves. Sub-dollar names face delisting. All of that feeds the volatility input, and therefore the premiums.

What is deliberately simplified

• One volatility per underlying, not a full surface. Real chains show a volatility smile and a term structure — different implied vols by strike and expiry. The engine prices from a single volatility estimate per name. This is the biggest deliberate simplification on this page, and it means you cannot trade skew.
• European-style pricing on American-style behaviour. Black–Scholes assumes exercise at expiry; the engine allows early exercise. In practice the divergence is small for non-dividend names and it keeps the maths tractable on a phone.
• Expiries are on a fixed ladder rather than every weekly and dated series a real exchange lists.
• No pin risk or exercise-by-exception nuance at expiry — settlement is deterministic.