If I am understanding you correctly I agree. The straddles I am selling are based on some sort of expectancy of what the stock and the vol is going to do. My reasons may be different than riskarb's (assuming we both spoke the same language lol) but it is not about picking high IV stocks and selling straddles.
ISRG reported good earnings and the stock is currently trading at $142 in the after hours after closing at $127 and change. I sold the $130 straddle for $21.70 so the IV will get sucked the hell out of this puppy for a nice one day return . Of course I would need it to hang around this level in teh AH and before the market opens tomorrow so I can take advantage.
congrats , couch ! if price stays , you looking at 9$ per combo tomorrow with iv collapsing to upper 40th
So now I am furniture.. LOL. OUCH, as of right now ISRG is trading at $125 in the aftermarket. Easy come ($142), easy go ($125).... EDIT: At 4:42PM the stock is at $133- someone is getting their ass handed to them in the AH lol.