$NVIDIA (NVDA.US)$ can anyone answer why i bought calls and ...
$NVIDIA (NVDA.US)$ can anyone answer why i bought calls and the calls price fell even tho i bought 145 calls when the srock thit 150???
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pootpoot : iv crush
Bakster : IV crush. Thats why I bought spy calls instead
JCpennyStonks : My shit went from .50cent to a ducking penny when it was at 151
104837679 pootpoot : What do you mean crash?
闷声发财 : Yes, I bought the call at 142, it went up to over 150, but instead it dropped.
pootpoot 104837679 : when u buy during earnings. theres implied volatility. meaning its more volatile.. therefore options are more expensive. so earnings is over now.. so IV goes back to normal
Vin11 pootpoot : 所以是正常的吗？芭比Q输到不行
160xreturns : IV fell down. yesterday was 140% now only 83%
pootpoot : usually for earnings. u should be buying call option prior before the IV goes up. when iv is high, it's better to sell options instead.
JNguyen : An IV flush/crash happens when the implied volatility (IV) of an options contract drops significantly. IV measures the market’s expectations of future price movement, so when IV is high, options premiums (prices) are inflated.
When IV drops quickly (the “flush”), the value of the option decreases—even if the stock price moves in your favor. This can result in losing money on the option, even when you’re “right” about the stock’s direction, because the drop in IV reduces the extrinsic value of the option.
Example:
Imagine you buy a call option on a stock before an earnings report. The option is expensive because IV is high—traders expect big movement after the report. After the report, the stock moves up slightly (a good thing), but the IV drops because the uncertainty is gone. This IV drop (flush) reduces the value of your option, and you might end up losing money despite the stock moving as you predicted.
I hope that helps.