In reference to MSTR, IV dropped very fast, almost overnight, allot, and the daily range was sliced in half. Also, the stock price drops while volatility drops and premiums are reduced dramatically. Is it normal IV, price, range, premiums to be down at the same time? Can somebody elaborate on it please?
Look at the chart. Absolutely nothing unusual happening here. All the data will manifest itself on the chart... so save yourself the trouble and just look at the chart... AND the chart is usually projecting ahead of the data. Like for example volatility is compressing so next volatility will expand...you can see this compression on the chart. I don't know what multiple MSTR does over Bitcoin 2x or 4x leverage but it would make sense it would drop the same multiple. If you compare Bitcoin to MSTR it is tracking as it should. Plenty of volatility left to go imo.
Yes, IV is down from 222% to 122%. Post parabolic moves see a reduction in volatility. We have a measure for 1 day historical volatility and it is charted below in the black line. That hit 424% on Nov 21st at the blow off top. It was also where Stephen Graham sold the top, an insider board member. https://gyazo.com/a896bc229514ef81843d63e4210d9efc
Thank you. I had a long position on the stock for weeks rolling a covered weekly/monthly call. Now while the price drops and my strike is at 360 my position is gaining!!! That demonstrates the power of IV
Hmmmm wonder why be sold .... I mean if bitcoin is going to 13 million by 2045 why would he sell knowing Saylor is going to just keep printing money in this infinite money glitch....very odd to see he sold just like the other insiders the last 2 years!
MSTR calls are so expensive. 1 call atm is $4846 (DEC27) if MSTR hits 430k by Dec20 your return is only $1980 at the current 121% IV. I think IV usually spikes to 400% during rallies so that would be $7338. So risking 2.4:1 or 1:1.5 depending...either way both terrible imo. So you could sell premium but that is going to tie up 37k in margin. I could buy 37k of MSTY and collect 5k every month doing nothing lol.