IV crush

IV crush is the drop in an option's price when the uncertainty it was charging for disappears, typically the morning after results. A ₹150 call can be worth ₹130 after a 3% move in your favour, because you paid for a bigger move than you got. It is the option side of why good numbers produce a falling stock.

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In the help centreSee how leverage and margin work on Mochatrade
  • Expected moveThe expected move is the size of move the options market is pricing for an event: add the at-the-money call and put…
  • Call optionA call option is the right to buy at the strike before expiry. Strike 24,200 and premium 80 means profit only above…
  • Implied volatilityImplied volatility is the volatility an option's price implies, worked backward from the premium: the market's priced…
  • Index futures (E-mini S&P 500)Index futures are futures on a stock index, like the E-mini S&P 500 on the CME. They trade almost round the clock, so…
  • Guidance (earnings guidance)Guidance is a company's own forecast for the next quarter or year, given with results. The quarter was priced weeks…
  • Earnings season / earnings reportEarnings season is the weeks after each quarter ends when most US companies report, starting with the big banks around…

Educational content only. Not investment advice. Leveraged products magnify losses as well as gains.

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