IV Crush: When Hype Turns Into a Premium Collapse
Implied volatility is the driver that inflates option prices.
Right before major events like earnings, announcements, catalysts. IV spikes and premiums get bloated.
Example: You buy a $TSLA call for €4.50 before earnings.
Stock moves up the next day… but IV collapses from 70% → 35%.
Image source: Bullish Bears
Implied volatility is the driver that inflates option prices.
Right before major events like earnings, announcements, catalysts. IV spikes and premiums get bloated.
Example: You buy a $TSLA call for €4.50 before earnings.
Stock moves up the next day… but IV collapses from 70% → 35%.
Image source: Bullish Bears