DislikedAn example of the kind of shit I won't play: PEP ... . PEP, an underlying with "three-star liquidity," announces earnings on 7/7 before market open. Its IVR is 34 (low), and its IV is 17 (low). A July 15th 1 SD short strangle (a 102/109) only yields a .54 ($54) credit up front, which is tremendously crappy for a $100+ underlying ... . A three-wide iron condor would yield even less. So, pass ... .Ignored
Not that I'm going to play this ... . The reason why HOG's IVR/IV is so high is because of rumors of a takeover (say it ain't so, Harley ... ).
(Additionally, because of the way HOG's strikes are, I couldn't quite finesse a "perfect" 1SD short strangle out of it, so, to a certain degree, apples and oranges ... ). Nevertheless, you get the general idea of what makes a premium selling play "rich"; it isn't the price of the underlying (although it can help), it's the "highness" of the implied volatility ... .
Fireworks are fun ... as long as you don't blow your fingers off.