excellent job as always, never knew the smirk was because of the relative value of a penny but that explanation made complete sense. thank you boys, cya tomorrow
That makes sense, I guess. I just never looked at it that way. So a credit spread of a certain delta is going to be wider if the IV is higher, meaning more buying power tied up. No free lunch, eh? OTOH, it might work better for a naked strangle … I would guess.
Another reason for the put smirk is because a 5% drop in the stock price is more significant, quantitatively, than a 5% increase.
excellent job as always, never knew the smirk was because of the relative value of a penny but that explanation made complete sense. thank you boys, cya tomorrow
That makes sense, I guess. I just never looked at it that way. So a credit spread of a certain delta is going to be wider if the IV is higher, meaning more buying power tied up.
No free lunch, eh?
OTOH, it might work better for a naked strangle … I would guess.
Nice thanks
Thanks a ton guys! Regards from India🙏
the other guy looked really confused in the third part ;)
Did you CAT too?