Options as LEGOs
How to explain options and put-call parity to absolute beginners
I never go back and watch interviews that I’ve done, but I did this one with my son, Zak.
And I’m really proud of it because I got to teach…using his spreadsheet!
The objective — teach an option’s concept to Matt as if he’s a kid and demonstrate why it matters for average investors in general AND why it matters to professionals.
Challenge accepted.
By seeing options as Legos, we see that everything can be built out of a few pieces. It explains the BOXX ETF and covered calls. It explains why understanding this one concept you can collapse the zoo of option thingies (straddles, strangles, condors, christmas trees, flies, boxes, jelly rolls) into structures you can re-derive from basic material.
This video starts at square #1 — the definition of calls and puts. Truly suitable for the beginner. Leave your ego at the door…I’ve already accepted that I’m not smarter than a 5th 6th grader.
FYI
I saw some AI tool called manus.im on my feed so I clicked on it.
[Anyone else feel like they’re speed-dating robots these days?]
I gave it one simple prompt:
“How is a covered call similar to a short put?”
I swear I heard it laugh at me before responding with this deck:
