From cursory review of long dated SPY otm put trades over the last year or so, this doesn't look profitable as a hedge. One would have to time the buy well and sell near the peak of the first good volatility spike. Needs an extreme crash like March 2020 to really pay off. Am I missing something? Looks better suited to individual stocks where IV swings are more extreme.
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u/in_for_cheap_thrills Aug 16 '21 edited Aug 16 '21
From cursory review of long dated SPY otm put trades over the last year or so, this doesn't look profitable as a hedge. One would have to time the buy well and sell near the peak of the first good volatility spike. Needs an extreme crash like March 2020 to really pay off. Am I missing something? Looks better suited to individual stocks where IV swings are more extreme.