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donnapland
- Thread starter donnap
- Start date
That's why I covered. I figured it would go lower and was tempted to just leave a limit to cover, but I didn't know if it would hit or if I'd get up for the open. This market is still pretty unfamiliar to me and I didn't want to blow it.
So now the position is the monthly short fly and short Sep 12 1990C. I was hoping to close the weekly at lower prices this morning, but no cigar, yet.
So now the position is the monthly short fly and short Sep 12 1990C. I was hoping to close the weekly at lower prices this morning, but no cigar, yet.
So the weekly's price was higher than I thought it would be this AM. That just means that yesterday's prices held up well. That's reflected as a rise in IV.
No doubt, this close to expiry, there should be some time decay, intraday. That'll be reflected as a drop in IV, but I assure you, it's time decay.
There are distortions in the greeks. It's wise to know that everything is derived from market prices. For example, IV tends to rise when the stock market drops. Often, some of that is attributable to a rise in option prices and some to lower UL price.
No doubt, this close to expiry, there should be some time decay, intraday. That'll be reflected as a drop in IV, but I assure you, it's time decay.
There are distortions in the greeks. It's wise to know that everything is derived from market prices. For example, IV tends to rise when the stock market drops. Often, some of that is attributable to a rise in option prices and some to lower UL price.
Here's another example. During my biotech gambling days, the option prices were often based on some binary event. In some cases, the option prices stayed about the same, vis-a-vis the UL, day after day. No time decay. Not very typical option behavior.
This was reflected as a huge increase in IV, but all it really meant was that the option prices stayed the same. We saw IVs 400+ often. There was at least one that was 700+. I'm sure that there have been many more, but those are just the ones that I looked at.
This was reflected as a huge increase in IV, but all it really meant was that the option prices stayed the same. We saw IVs 400+ often. There was at least one that was 700+. I'm sure that there have been many more, but those are just the ones that I looked at.