IV behavior observation

Text book implied volatility behavior states:

Stock down, IV up.
Stock up, IV down.

From personal experience, this behavior is more fitting for broad mkt indices
and does not necessarily apply to individual stock options.

Here is an example, RIMM post earnings (earnings out 6/25).
News out, stock gapped down and continued down, yet IV going down.


I see this behavior quite often after any kind of news out on stock options. Even tho stock is down or tanking, the uncertainty and interest in them options fade quickly. Astute traders may be able to pickup some back month vol if this fade is overdone towards buy levels, for a quick vega play.

Its My Turn Now

From the hit Disney movie Jumpin comes the hit song performed
by Keke Palmer. You may know Keke from Akeelah and the Bee (2006).

Check out the lyrics on this youtube clip. Every bit as inspiring for the traders
that are ready to take on the adventure.



The original non-lyric video can be viewed here