a question on implied volatility

Discussion in 'Options' started by adamchubb, Apr 16, 2010.

  1. I've got a question on implied volatility.

    Usually,
    1. the market goes down much faster than it goes up (not always, but usually)
    2. implied volatility goes up when the market goes down (not always, but usually)

    So, considering the above 2 relations, can we say that implied volatility goes up much faster than it goes down????
     
  2. MTE

    MTE

    You can just look at a volatility chart (e.g. VIX chart) and see whether your assumption holds or not.

    I'd say generally it is true that the vol spikes up very quickly and then takes some time to settle back down.
     
  3. Yes, it's only human...
     
  4. Fear > Greed. Now everyone has their finger on the buy put/sell underlying button; not to mention the sell stops. That is why the speed of declines is so fast.