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##### S-POP Revolutionary Method of Calculating Probability

POP (probability of profit) has been a common term used in the options trading industry for decades. It’s a method to calculate a probability of profit of an options trades based on the current implied volatility of an underlying asset.

While this method has been “sticky” for such a long time, it has never proven to be a valuable method to calculate its own name.

###### POP False Assumptions

The POP method makes assumptions that are clearly false:

1. Â It assumes that the probability of an underlying of moving up or down at every given moment is exactly the same, a 50/50 scenario. This is statistically wrong.

2. Â It assumes that the implied volatility of the underlying will not change or assumes a trader can accurately input its correct future change into the POP calculation. This is emphatically wrong.

3. Â It assumes that the risk of an options trade is acceptable within the probability zone, and that the options trader can utilize the entire POP zone. This is not realistic whatsoever.

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###### S-POPâ„˘Method, Patent-Pending by optioncolors

S-POPâ„˘ (statistical probability of profit), a patent-pending invention by OptionColors, Inc., is the next-generation probability calculation method for options trading, making POP obsolete.Â Instead of relying on the current implied volatility and false assumptions that go along with it, S-POPâ„˘ is a method of probability based purely on statistics. Â Software that uses the POP method is outdated, which is pretty much all options platforms on the market today, except for OptionColors.

With OptionColors’ S-POPâ„˘ method a user can apply statistics to any options trade for a more realistic probability calculation. A user can create S-POPâ„˘ based on seasonality, price moves, various volatility levels and much more.

## S-POPâ„˘ In Action

If you have access to typical options software, then you know that standard POP, is used to superimpose a price range over a risk profile. Price ranges such as 68% for 1 standard deviation, 95% for 2 and 98% for 3 standards deviations are very common. It’s nice to see the price ranges based on current implied volatility levels, but that is all you get with the old-fashioned POP risk-analysis method.

Our invention, S-POPâ„˘, is much more robust, flexible and provides options traders with several realistic risk-modeling models. Our clients say it should be the next standard risk modeling method for the entire industry.

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##### What's Over Underâ„˘?

OverUnderâ„˘ technology by OptionColors is patent-pending formula which locates overvalued and undervalued options in seconds, making logical & optimized trades super easy to create.

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