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Anyone doing it again on BIDU tonight? IV much higher.

OC, I meant best case scenario in terms of price.

No, the Jan short straddle does not look like it was a good risk/reward trade after all at all. A small gain when we have best case scenario.

Jan's straddle: not bad. May's IV dropped much more though.

Well, the short straddle is looking very good right now. Let's wait for CC but well done Atticus!

Sorry to disturb your highly technical discussion. Trying to learn from you, but "cheap tails"? Are you referring to the wings of the butterflies?

What are the "safer and smarter ways"?

Looks like it would have been better for you to wait until last minute to sell the straddle as they are bidding those up.

Is that a 4%-5% drop? not familiar with the "bp".

Oh Ok, so you are looking at a mix of Vega and Gamma. The front month's drop in IV might be negated by the move in stock price/delta. And even if the Jan's IV will drop less, they will be less affected by move in price. So what kind of move can we expect for Jan's IV? I am trying to model a...

I understand the lower Gamma, but how can we have higher Vega when we agreed earlier that the IV on the front month will drop more?

It does look like a very high probability trade. Do you predict a 10% drop in IV on those?

Atticus, why the Jan 09? What about selling a ratioed one if someone is more bullish? (Like sell 10 puts and 8 calls)

Atticus, I looked at the fly you suggested on TOS and the profit range is actually way tighter than what I suggested. Also, I think it is very similar to my trade, but I still don't understand why buying front months instead of further out is a superior trade. I am sure there is something I am...

"Trading duration flips it from short to long vega." Could you please explain this? Appreciate your comments.

"You're really not. You're long vol. These diagonals are simply long time spreads. That difference [vertical vs horizontal] is what causes modality to flip on vega." Ok, you lost me LOL

Atticus, what you are proposing, which is buying a stangle/straddle and selling one is pretty much what I am doing in spirit. The only difference is that you are doing everything front month and I am getting Jan and July on the long side. My question is why would you go front month on your...

I got the Jan 09, because as explained I am planning on holding those after earnings and selling premium against them every month. I got July for the long puts, because these should keep some IV due to events in between.

"Model a vol-drop of 10 handles in the front and 3 in the back. These calendars rarely work on big beta tech. Good luck." You mean a drop of 10% of IV in the front month and 3% in the back? Is that what usually happens on earnings? I agree that calendars are not the way to play earnings on...

Thanks everyone for your answers. Atticus and OC, it did not model flat volatility, but my experience is that the front-month volatility will be the one to really drop as it is the most inflated, don't you agree with that? It seems to me that your model forecasts a uniform drop in volatility in...