Always see a lot that high IV stocks are best for Iron Condors due to some of the advantages. But if the premiums arent that much higher, (65 IV stock), compared to a 30 IV stock, is the risk worth it? The larger swings from the higher IV stock can seem tricker to manage the IC , or am I mistaken?
Are higher IV Stocks best for Iron Condors?
byu/REI_N_Options inoptions
Posted by REI_N_Options
5 Comments
Yes and no. Iv is high for a reason
IC is used when you predict IV will fall during the holding period.
The starting value is only part of the equation.
It’s a trade about future vol, not current
IV literally describes the pricing. You want to sell vol when you think it is overpriced, for how much itll move.
best to use them over binary event like earnings high IV sell it before hand enjoy the IV crush after the event and buy it back for a profit
another way , similar idea is sell 0DTE IC’s over lunch on SPX and wait an hour then buy them back cheaper