Hey lads
I'm used to day trade 0DTE Spy options.
But something is wrong today.
On a regular day i'm used to buy a +3$ OTM premium for aproximatly 0.5
Today the 0.5 premium is +11$ OTM.
I'm very confuse about that knowing the volatility is low today.
Any idea on what's going on?
Posted by Drunken_seller
8 Comments
FOMC on the interest rates @ 2pm. so it’s going to get crazy later.
Volatility raises the premiums of options contracts. It’s as simple as that. Consider Vega when buying OTM contracts because Vega can also reduce Delta. 👍🏻
There have been numerous stories in the past week in the financial press like Bloomberg, WSJ highlighting the pricing of options for FOMC day.
Oh yeah
Lets check vix😁
People are expecting to see 2% swings of sp500 today😁
Vol is low today??
If you are unaware of the FOMC meeting today and how it may impact markets, you probably should not be trading options.
That’s definitely unusual. Option pricing can be impacted by things beyond just volatility, like changes in interest rates or big moves in the underlying stock. Have you checked if there’s been any news or announcements about SPY today that might be driving unusual activity?
I wonder what it could be…. 😓
If you didn’t know this was happening you probably shouldn’t be trading options and you definitely shouldn’t be trading 0DTE SPY options