>>>I’m hosting a live Maverick demo at 2 PM ET, when I’ll also share my crucial insights on stocks that may be in trouble!<<<
If you’re still out there buying calls and puts like it’s 2020, you’re playing the game with a stacked deck — and you’re not the house.
Right now, this market is built for sellers. Premiums are inflated, implied volatility is elevated, and the price action doesn’t justify the price of the ticket.
Traders look at the VIX and think it’s telling them what’s happening. It’s not. It’s telling you what the market makers expect. And those expectations are already baked into the cost of every option on the board.
When you’re paying sky-high premiums in a low-movement environment, the odds are already tilted against you — and that’s exactly where the sellers want you.
Volatility’s the Weapon — and the Shield
The whole edge for option sellers right now is in the spread between implied and realized volatility. When implied volatility stays high but actual market movement is muted — which is exactly what’s been happening — sellers keep the edge.
They’re collecting inflated premiums that aren’t being threatened by price movement. The market isn’t moving enough to break through strikes, and theta decay plus IV crush is grinding down the value of every long contract faster than most buyers can react. It doesn’t matter if you nail direction. If the move isn’t violent and fast, the market maker walks away with your money.
This is why credit spreads, iron condors, and covered call strategies are working so well right now. Not because they’re magic — but because they’re playing the other side of overpriced contracts.
The Danger Zone for Buyers
Most retail traders don’t realize how fast IV drops when uncertainty clears — or how little it takes to wipe out a winning trade. You could be spot on with direction and still end up red just because the option you bought was priced for a move that never came.
It’s the same principle that wrecks straddles and strangles after earnings. If the move isn’t big enough to beat the baked-in expectations, the trade loses — even when the call or put finishes in the money.
That’s why the smart money isn’t betting on movement. It’s betting on no movement — or at least not enough to threaten the premium they’ve sold.
So while everyone else is out there swinging for the fences, smart traders are sitting back and letting overpriced contracts decay in their favor. You don’t need fireworks to make money — just a market that keeps mispricing risk.
That’s exactly what we’ve got right now.
Kane Shieh
Kane Shieh Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. First, This Signal, Then This Move
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