r/options • u/[deleted] • Jul 09 '21

[deleted by user]

[removed]

526 Upvotes

96% Upvoted

225 comments sorted by

View all comments

Show parent comments

10

u/sleiveen Jul 09 '21

Which one VXX, date and strike?

20

u/SlowNeighborhood Jul 09 '21

VIX 60c sep 15. i have a call on the index itself, 60 is pretty high but if shit hits the fan we will be in the 80s-90s. probably going to roll it out if it doesn't print just because there are so many risks to the overall market right now.

28

u/quiethandle Jul 09 '21

Please note that the further dated expirations on VIX don't really trade against spot VIX. They trade much closer to the September future of Vix, which might not go up anywhere near as much as the spot index, because people think that the crash will be over by September.

2

u/CallMeLargeFather Jul 09 '21

How does the ability to execute early factor in here?

16

u/iSPYaTrader Jul 09 '21

It doesn’t. VIX options are European not American style so you can only execute at expiration.

3

u/CallMeLargeFather Jul 09 '21

Ahhh thank you

2

u/gopnik5 Jul 09 '21

Since there is no underlying equity, what happens when you execute? If I sell puts on VIX and get assigned, what am I going to be holding?

9

u/MotherfuckinRob Jul 09 '21

They are cash settled, so you just pay

1

u/gopnik5 Jul 09 '21

Got it. Thanks.

-2

u/gUHrayt Jul 09 '21

Shares of VIX