Discussion in 'Options' started by clarodina, Jan 6, 2011.
does decreasing ivol positive or negative for theta?
As volatility decreases so does theta.
increasing implied volatility makes options more expensive but increase options theta which makes options value erode more. should you sell option on increasing implied volatility or decreasing implied volatility? because increasing implied volatility makes options more expensive and thus a good deal to sell options but WHILE the implied volatility is increasing should u sell options?
You sell options ( call or put ) when you expect IV to drop soon.
Keep in mind that time and volatility are simply synthetic equivalents.
IOW, I can replicate an instantaneous passing of time via lower IV.
Separate names with a comma.