Trade Managers

Delta, Vega and Time

Trade Managers

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

Mike & Nick explain the relationship between delta, vega and time, and why big spikes in IV are so opportunistic for them as premium sellers. As long as there is a lot of time associated with the contract they sell, the potential vega contraction can easily outweigh any directional move against them - they look at a short call, and see how the option can lose value even if the stock rises against them.

Tune in for a great discussion!

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