I’ve been considering VIX calls with the current market volatility.
I haven’t traded them before but I heard they can help when things get rough. I’ve lost money on regular options in previous dips.
Do they provide real protection or are they just a risky move? The premiums seem high now.
VIX calls can act as insurance for your portfolio, but timing is crucial. Premiums rise sharply when volatility increases.
It’s best to buy them when the market is stable and the VIX is low. Waiting until chaos erupts means you’ll pay a lot more.
Keep in mind that they also lose value quickly, making long-term holding a challenge.
High premiums mean the market stress is already baked in. VIX calls are solid protection. Grab them when VIX is below 20. Time decay destroys value quickly when calm.
VIX calls were decent for me last year. Got in at 15, sold at 28 during that banking scare.
I picked up VIX calls during March 2020 thinking I’d cracked the code. I made good money initially but got greedy and held way too long.
Those things decay like crazy once volatility drops. I watched 60% of my gains vanish in two weeks.
Lesson learned - I only use VIX calls for quick hedges now, never as buy-and-hold plays.
Yeah, those premiums are pricey for good reason. You want to buy VIX calls when it’s quiet and cheap, not when everyone’s freaking out. Treat them like quick trades, not buy-and-hold investments. People always screw up by hanging on too long after vol spikes.
I never put more than 2-3% of my account in VIX plays and always set profit targets. Good for hedging but they’ll torch you if volatility tanks.