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Implied volatility on one week puts is around 60% right now. Downside protection is very, very expensive, even if it does work sometimes.
by benmanns 7y ago
Implied volatility on one week puts is around 60% right now. Downside protection is very, very expensive, even if it does work sometimes.
- tempsy 7y agoI’m playing with house money at this point, and bought on Friday and Monday/Tuesday before IV got massively inflated. No good news came out this weekend, if anything it’s only gotten worse. A V shaped recovery is unlikely, but if it does go up this is a hedge, not a bet, and my portfolio is net long.
- AznHisoka 7y agoHedging is only effective when you don't need it. Sort of like home insurance - you don't buy it when you house is already burnt down - the premiums will skyrocket and it doesn't do you any good. Last week, and Monday afternoon was probably the last opportunity to buy hedge at a decent value.