Add training workflow, datasets, and runbook

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194 •   TheIntelligentOptionInvestor
Advanced Building Corp. (ABC)
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5/18/2012 5/20/2013 249 499 749 999
Date/Day Count
Stock Price
GREEN
Here I have again maximized my tenor by buying LEAPS, but this
time I increase my leverage to something like an “IRL/10.0” level in case
the stars align and the stock price sales to my outlier valuation.
Some people would say that the IIM approach is absolutely the op-
posite of a rational one. If you are—the counterargument goes—confident
in your valuation range, you should try to get as much leverage on that idea
as possible; buying an ITM option is stupid because you are not using the
leverage of options to their fullest potential. This counterargument has its
point, but I find that there is just too much uncertainty in the markets to be
too bold with the use of leverage.
Options are time-dependent instruments, and if your option expires
worthless, you have realized a loss on whatever time value you original-
ly spent on it. Economies, now deeply intertwined all over the globe, are
phenomenally complex things, so it is the height of hubris to claim that
I can perfectly know what the future value of a firm is and how long it will
take for the market price to reflect that value. In addition, I as a human
decision maker am analyzing the world and investments through a con-
genital filter based on behavioral biases.
Retaining my humility in light of the enormous complexity of the
marketplace and my ingrained human failings and expressing this humility