What information does hist. vol - imp. vol give you?
JoaoPauloPires
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@thekingjames, well not much relevant if only you want clues for market direction, but can give info about options in general... in evolving markets options are becoming more or less expensive by comparing the relative terms between imp. and hist., do you agree? if implied volatility is decreasing options are cheaper in relative terns .. do you decide about buying or selling options based on that? well no... I do not recommend... but is just curious to know how is pricing at the moment, if it is cheap or if it is expensive.
thekingjames
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@JoaoPauloPires, fair enough! Vol plays a huge role in options.
JoaoPauloPires
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@thekingjames, for example, if you buy call options, and if the underline stock or etf is not in an uptrend, is in a situation of downtrend or simple nowhere trend (theta decay probably in short term expiration will make a big issue), options with higher implied volatility will lose more premium..