# LP or sell the option?

A concentrated range kept on the price and a short at-the-money option are two ways to sell the same risk: that the stock moves a lot. This playbook uses [vol ratio](../vol-ratio/README.md) to decide which one is paid better right now.

## 1. Shortlist in Discover

Open [Discover](../discover.md), keep the **Simple** view, set the window to **24h** and sort by **Vol ratio**.

Skip pools without a chip rating. **No benchmark** means there is no listed option to compare against.

## 2. Read the chip

- **Well paid (1.2× or more).** The pool pays more for the risk than the options market. LPing is the better-paid way to sell this volatility.
- **Fair (0.9× to 1.2×).** About even. Other things decide: capital efficiency, your access to options, how actively you want to manage.
- **Underpaid (below 0.9×).** The options market pays more for the same risk. If you want to sell this stock's volatility, writing the option is the better-paid route, or skip it.

## 3. Check what the ratio stands on

Hover the vol ratio cell, or open the pool and look at the **Vol ratio by width** tab.

- **The width.** The headline is the widest range whose matching option is listed. If you plan to LP much tighter, look at the ratio at your width.
- **The ≈ sign.** It means the matching option is longer than any listed expiry, so the comparison is looser.
- **Seven days of fees.** Check **Price and fees**. If most of the week's fees came in one burst, the ratio may not last.

## 4. Check what the ratio leaves out

- **Flags.** Switch to the **Risk** view or check the pool page. **Vol spike**, **One-sided** or **Launch** mean the last week may not describe the next.
- **The open.** A tokenised stock can gap when the US market opens. A tight range gets run over; an option writer takes the gap too, but a range can't be hedged as simply. Wider ranges suffer less.
- **Earnings and events.** Options price known events such as earnings into their IV, while a week of fees knows nothing about next week. A high ratio just before earnings is a warning, not a gift.

## 5. Size it with the planner

Open **Plan a range**, pick your width and size, and read **Vs listed options** and **Premium gap**. They repeat the comparison for your exact range, in vol points and in dollars.

## Example

A pool shows **Well paid 1.45×** at ±10%, measured against a 23-day option.

- Seven days of fees imply the range breaks even at 41% volatility, while the matching option's bid IV is 28%.
- The **Price and fees** chart shows steady fees through the week, with no flags.
- In the planner at ±10% and $10,000, **Vs listed options** reads +13 vol points.

Reading: LPing this pool paid clearly better than writing the option last week, on steady flow. Before depositing, check the earnings calendar and decide how you'll handle the next US open.

*Illustrative numbers.*