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On a second thought, I can still trade it if the back month IV is close to historical IV. When you long a calendar spread, it is the drop in the back month's IV that really hurts.

I would recommand the Options Lab at <a href="http://www.theoptionslab.com">http://www.theoptionslab.com</a>, it shows you all the stuff you need to do regarding an options strategies, its P & L and greeks. You can see how your trade play out by adjusting the volatility, price and days to...

They might not get executed when you need them the most. They might get executed when you wish they don't.

8 vol points are too small to justify a calendar spread when vol is around 50% to 60%. I would like to see a 30% differences, in this case, that translates into 15 to 18 pts.

1. Stop order replacement. 2. Leverage. 3. Defined risk.

The very 1st post mentioned it.

The FX futures options is the only fx options we trade here. FX is just another underlying asset for us. It is perfect forum for the topic.

The 1st time I heard about the size of fx market was when I read the 2nd Market wizards 15 years ago and thought the same way as you do, which is, the bigger the market, the bigger the impact. Sizewise, fx > bond > stock. Also a book called intermarket analysis by John Murphy talked about the...

Do you mind elaborate on why the front month is ignored ? I would imagine any IV spike is usually a short term thing. espically for an individual stock. Also 70-80% of activity and focus are on the front month with back month most likey used as a hedge.

What does IV30 mean ? Why is it at 164 while the IV is 300 plus ? Thanks

An old book called OptionsEdge: http://www.amazon.com/Options-Edge-Winning-Volatility-Futures/dp/0070382964

my impression is that both gold/crude and fx get direction from stock market for the past few months,

only 7 days ? it seems like a long time ago :-} The QEII has been fully discounted by the move from 1.27 to 1.42 even before 11/3. Now do you remember what you were thinking back then? Could you summarize your thinking and forecasting at the time? Were you bearish the dollar? It would be...

EUR Dec futures at 1.3726 right now, with 1.4 call at 0.073. The fact that EURO didn't budge at all when DOW dropped > 2% impressed me. Do you think the recent 600 points drop have fully discounted the Euro debt woe ? What is the next stop: 1.42 or 1.31 ?

You can't. During the last tading day, buyers for many OTM contracts just simply disppears because the options become worthless. It is true that MMs have both obligation and incentive to make a market. It is the competition itself that make the bid/ask spread narrow as it is today. It is...

OL=The Options Lab URL=<a href="http://www.TheOptionsLab.com">www.TheOptionsLab.com</a>

Just the fact that VIX is in a 6 months low will give me a pause. It turns out to be a good trade for the past three days.

When to close them ? Hold until exp ?

and this

where you can compare two strategies' P & L and greeks, etc side by side. See images below,