Time to Sell Volatility, According to One Expert

Leora Heathcote
1 mins

One expert said that options look pricier and now is the time to sell volatility.

The Bollinger bandwidth has declined to lowest since October 2020. (TradingView/CoinDesk) (TradingView, CoinDesk)
The Bollinger bandwidth is a key indicator used by traders to gauge market volatility. The recent decline to its lowest level since October 2020 suggests that the market is becoming increasingly calm and that prices could remain range-bound in the near future. This could provide an opportunity for traders to take advantage of small price movements in either direction.

Is now a good time to buy volatility (or options)?

Options appear pricier as the gap between implied volatility and historical volatility widens. (Genesis Volatility) (Genesis Volatility)
As the gap between implied volatility and historical volatility widens, options appear increasingly pricey. This may be due to market uncertainty or expectations of future volatility. Either way, it's important to keep an eye on this trend as it can have an impact on your trading decisions.

Vestibulum iaculis ligula et accumsan tristique. Nullam et odio id ante feugiat ultricies ut vel orci. Sed finibus faucibus purus quis suscipit. Vestibulum mattis, odio imperdiet commodo ullamcorper, sem justo rhoncus nunc, quis lacinia felis erat eu nunc.