Market Measures - July 2, 2021 - What to Do When Vol Dries Up

published 3 weeks ago by tastytrade, Inc.

There are three key mechanical steps we can take in periods of low IV to continue trading short premium (since it still was net profitable) while keeping risk at bay:Total portfolio allocation should be around half what it is in high IVConsider defining risk in short premium positions simply for the added outlier protectionShort deltas may help mitigate portfolio volatility when markets become turbulent

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