Trading IV skew change

[betcashrun]

As already said, to play skew change: use delta-neutral vega-neutral risk reversal.
If you want option-only strategies, the delta hedging is replaced by synthetics.
For instance:
Buy OTM put / sell OTM call / buy fraction of ATM call / sell fraction of ATM put
Such that: Vega(OTM put)= Vega(OTM call) and Delta(OTM call)-Delta(OTM put) = fraction

 

[taowave]

ugghhh..meant to say sticky delta...

Theoretical edge comes from Orats,and in particular their metric D%..Im going to ask Matt to chime in,but here's a quick discussion

https://www.elitetrader.com/et/threads/what-is-iv.361608/page-16

I tend to trade alot of shorter dated OTM flys,split flys and operate under a sticky strike format..If there's no "edge" under that assumption,I tend not keep my size smaller

 

[it365]

ugghhh..meant to say sticky delta...

When you say short term, how many days/weeks are you talking about? I am playing with similar strategies inspired by destriero. Seems to me 40-50 DTE allows you to do some adjustments if your initial directional bet goes south by a lot.