My understanding is that an extremely OTM put on a clear, strongly held thesis would be Burry-like, and many people would be able to do so.
But Taleb's point is that (non-insiders) cannot accurately predict regarding individual securities (hence derivatives), but can identify over-/under-priced OTM options — and that, trading these systematically, one can suffer many repeated "small" losses that become outweighed by the Big One that eventually (yet unpredictably) hits, thus generating overall positive expected value. But, as I further understand Taleb, most people don't have the huge capital that enables such a strategy, and that doctors, lawyers, dentists, etc., are better off making money by plying their professional services and perhaps investing in index funds and the like.
it's not 100% real, I bought a call last week at a deep discount to the ASK.
Do you remember the stock market a few decades ago? Stocks once had large bid/ask spreads. Now the hft/dark pools eat it all, with 99% profit on trades. High speed, lasers and fiber optics front-running..
Buy the options with the intention of them either hugely appreciating in value or expiring worthless. Under Taleb's system, your bet sizes should be small enough that it doesn't matter if individual options tranches expire worthless. The bid/ask spread only matters when you try to cut losses on a large bet, which is outside the scope of this strategy.
look at strikes where higher OI is. everything will be arbd out by bots on anything that isn't thin though. i trade futures for this reason though, because they are actually centralized unlike us equities. selling calls for a credit or spreading into free long entry is a better strategy in every way though.
