The simplest way to hedge Vega is to trade vertical spreads.
BoomerCapital on
Vega is one of the most core components of options. Only way to reduce Vega risk if you’re playing purely for delta/gamma is spreads. This only reduces the risk though, it can’t be eliminated.
WanderingLeif on
VIXY ETF tracks the VIX, which is basically a measure of the IV of the S&P500. SVXY is short the VIX. Not sure if that helps.
Juannietrader on
I agree with the previous answers. The only way to hedge against Vega would be to buy volatility products or buy options. This will give your position/portfolio long vega exposure
AOB23423 on
Maybe some kind of vix exposure. Calls/puts on the vix or maybe the vix futures.
5 Comments
Well Vega only affects options so…
The simplest way to hedge Vega is to trade vertical spreads.
Vega is one of the most core components of options. Only way to reduce Vega risk if you’re playing purely for delta/gamma is spreads. This only reduces the risk though, it can’t be eliminated.
VIXY ETF tracks the VIX, which is basically a measure of the IV of the S&P500. SVXY is short the VIX. Not sure if that helps.
I agree with the previous answers. The only way to hedge against Vega would be to buy volatility products or buy options. This will give your position/portfolio long vega exposure
Maybe some kind of vix exposure. Calls/puts on the vix or maybe the vix futures.