One of the hallmarks of volatility is massive up moves and what we saw this week was the largest up move in a week since 2011. 2011 just so happens to be the last time there was significant volatility in market. In this crucial weekend video newsletter we answer the the question - is this rally for real? Watch the video now to find out...
2 Comments
Al
February 16, 2018You're right about the present opportunity to sell premium. But as yet there's no opportunity to buy it back. That means you have to stay in those positions you create in the midst of big moves/surging momentary volatility. You cannot buy premium back without seriously overpaying for it, because as you correctly state in the video, VIX is not coming down. This means (to me) that while indeed, the environment is ripe for premium selling, it is equivalently expensive to buy it back. I have done some daytrades selling premium on MSFT and buying it back for 75 cents; which is (these days) I would say certainly well above its average volatility. It's pretty rare you can achieve that kind of range on MST. It ain't GOOGL.
Stephen Ruzanski
February 19, 2018So where do we go from here?