Read on Twitter
New #OptionSellers that started selling options in May 2020 taking on that extra Leverage!
#OptionsTrading
#OptionsTrading
This is what #IndiaVIX has done since May-2020.
#volatility
2/n
this wasn& #39;t going to be a thread, but then #wth
#volatility
2/n
this wasn& #39;t going to be a thread, but then #wth
Let& #39;s see, now a new #Options trader, lets call him... nevermind whatever his name, gets into #OptionSelling in May-2020.
He has only seen a falling #Implied Volatility regime. If he isn& #39;t looking at IV, his sold options are decaying like crazy.
3/n
He has only seen a falling #Implied Volatility regime. If he isn& #39;t looking at IV, his sold options are decaying like crazy.
3/n
He is up on his capital nicely. Well done!
The thing is, he has not yet seen the effect of what an increase in #IV can do to his positions.
Moreover, he hasn& #39;t seen what a disconnect of IV and RV can do to his positions.
4/n
The thing is, he has not yet seen the effect of what an increase in #IV can do to his positions.
Moreover, he hasn& #39;t seen what a disconnect of IV and RV can do to his positions.
4/n
But given the nice performance of his trades, he decides to either increase his trading capital, or if he hasn& #39;t thought through it, goes on to increase leverage.
What could happen next, is what this tweet/discussion is about.
5/n
What could happen next, is what this tweet/discussion is about.
5/n
