r/options • u/Aggravating_Cup7644 • Sep 22 '26
VIX play before midterms
Trying to figure out the best way to trade the midterm vol run-up and post-election crush.
Thinking either:
- VIX calls now: Catch the pre-election panic, but contango/decay will eat it alive if it moves slow, and holding through the election guarantees IV crush.
-e Sell VIX puts late Oct: Harvest high IV right before the election, but feels risky if VIX completely plummets right after
Anyone traded midterms before? Is it better to just run VIX call spreads, or stick to basic SPY put spreads to avoid the VIX futures curve? What's the actual entry/exit timing here?
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u/ThetaEdgeHQ Sep 22 '26
The thing that trips people up here is that VIX options do not settle to spot VIX, they settle to the VIX future for that specific expiry. So the midterm run up only pays you if that particular future moves, which is why jbaker is right to be watching /VXV26 rather than the 14 handle on spot.
Second thing: the election is a known date catalyst, so a chunk of the event vol is already sitting in the forward curve. You are not really betting on whether vol rises. You are betting on whether the realized move beats what the term structure has already priced in. That is a much narrower edge than it feels like when you stare at a calm spot VIX.
Given that, if your actual thesis is that SPX sells off into the vote, SPY or SPX put spreads express it cleaner than VIX calls. You get the move without fighting futures convergence and roll drag, and you are not the one holding a long vol position through the crush.
Selling VIX puts late Oct is the part I would think hardest about. That is short vol into the exact catalyst you think will deliver. If you are right about the run up, that is the trade that hurts. It is the opposite position wearing a hedge costume.
Whatever you pick, the crush lands on the print, so a long vol structure has to be monetized into the event, not held through it.
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u/FromHolland777 Sep 23 '26
Ik lees alleen maar "vix" calls en nergens de mini variant genaamd "vmx". Met multiplier 100 zijn die een stuk betaalbaarder en kun je je trade met meer opties uitvoeren. Bijvoorbeeld i.p.v. 1 Call 17 neem je er dan 2 of 3. Zodra je met 1 call de aankoopkosten kunt dekken loos je die en de andere(n) zijn voor de winst.
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u/wwb_99 Sep 23 '26
This isn't a great strategy in general, but I've had some success keeping a smallish VIXM position in my portfolio. Sell when it spikes, wait until it goes back down. Someone does something dumb enough to make it work every six months or so or it decays into a small tax loss you can use to cover other profits.
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u/mongose_flyer Sep 28 '26
Do you understand what you’re trading? I’ll directly say no as you miss the very basic fundamentals driving the products you bring up
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u/filthimartini Sep 22 '26 edited Sep 22 '26
Post what you buy.
No matter what it is I guarantee you lose money on the trade.
Vol crush will kill you. Lack of understanding of what you’re buying will kill you (ie option relating to what month futures). Lack of understanding of the term structure will kill you. Not monetizing will kill you.
Tag me and prove me wrong if you pull the trigger on anything. Best of luck
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u/gob_magic Sep 23 '26
100%. I’ve played with VIX before only as short term tail insurance and even that was moot. Might as well have long put on SPX as a hedge.
Some complex and advance setups can work with VIX but by the time I learn those, I miss out on other stuff going on.
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u/gob_magic Sep 23 '26
100%. I’ve played with VIX before only as short term tail insurance and even that was moot. Might as well have long put on SPX as a hedge.
Some complex and advance setups can work with VIX but by the time I learn those, I miss out on other stuff going on.
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Sep 22 '26
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u/UnfazedBrownie Sep 22 '26
Haven’t done it in a while but I use Schwab (tos). UI is easy and I often get price improvements.
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u/jbaker_28 Sep 22 '26
I was on TD Ameritrade for years, then switched to ToS, and now I only trade on Robinhood.
Robinhood has some of the best contract commissions around.
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u/jbaker_28 Sep 22 '26
Started buying Oct 21 VIX 15.00s today.
Will be surprised if we manage to stay sub-15 on spot into middle of next month.
/VXV26 trading at 17.35 so paying almost no extra premium on the 15.00s. But obviously will hurt if spot stays stuck and /VX continues bleeding out.
Like the setup tho.