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Strategies & Market Trends : Selling Puts: Have Cash Will Travel
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To: taxman who wrote (929)1/23/2000 11:10:00 PM
From: OX  Read Replies (2) of 1235
 
>>>what the implied volatility should be is subjective

while it's true that IV is set subjectively, it does have to fall inline w/ the surrounding strikes and also corresponding Call (or Put). otherwise there are arb opps there. at least that's the way I understand it to work in theory. for options on very liquid stocks like DELL, I don't think you'll see abnormal volatility skewing for very long.
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