In recent weeks, the peripheral world of financial options has charged centre stage. In the dramatic duel between chat-room traders and stock-shorting hedge funds, the role of options has been central and widely discussed. While the David vs. Goliath story has been riveting and the intricacies fascinating, the broader role of optionality for investors deserves greater emphasis. Arguably, the most valuable option of all has been overlooked: doing nothing preserves and protects the option to do something. In effect, all investment decisions are a subjective attempt to price this crucial option. Nassim Taleb captures this insight characteristically well in his…

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