Hey traders,
A lot of folks get nervous when the market starts whipping around.
Big swings… scary headlines… Powell opening his mouth at Jackson Hole…
All of it can rattle you if you don’t have a plan.
But here’s the truth:
The more volatile a market gets, the juicier the options get.
And when you’re an option seller — which you should be — that’s when you’re making hay while the sun shines.
Why Volatility Pumps Up Premiums
Options are priced on movement. The more the market expects a stock to swing, the more expensive those options become.
That means when implied volatility jumps, the price of both calls and puts gets inflated.
As an options buyer, that means placing trades gets more expensive.
But if you’re the one selling those contracts, you’re getting paid more up front for taking the other side of that trade.
Think of it like an insurance company.
When storm season rolls in, the cost of coverage goes up. The risk is higher, so the premium is higher. Same thing here.
Selling in a Volatile Market
Here’s the beautiful part:
- Bigger premiums give you more room for error. If you sell a put, you can sit further out of the money and still collect a fat credit.
- Mean reversion works in your favor. Volatility tends to spike and then cool off, so those pumped-up options you sold often lose value quickly once the dust settles.
- Consistency beats prediction. You don’t have to call the next Fed move or guess if Nvidia’s earnings will beat or miss. You’re just stepping in and collecting rent while everyone else is freaking out.
The Takeaway
Don’t let volatility spook you.
If you’re a buyer, sure — wild swings can chew through your account fast.
But if you’re selling options the right way, volatility is fuel. It’s what turns an ordinary week into a high-probability payday.
That’s the whole trick: let the market panic pump the premiums, then step in with controlled trades that benefit from the fear.
That’s why I welcome these market storms. They don’t scare me — they set the table.
Trade well,
Jack Carter
P.S. Speaking of being an options seller… Amazing things happen when you stop swinging for the fences and start trading a consistent, steady strategy.
