With VIX finally breaking 15 here, I need to strike while the iron is hot ... . The instrument of choice -- IWM, the broad index exchange-traded fund (as compared to SPY, DIA, QQQ) with the highest implied volatility currently ... .
Metrics:
Probability of Profit: 52% Max Profit: 127/contract Max Loss/Buying Power Effect: 273/contract Break Evens: 114.73/127.27
Notes: Naturally, I'm going to watch the markets early next week to see if there's continuation in this dip. If there is, I may hold off slapping something on for even higher volatility. Heck, I waited eight weeks or so for VIX to break 15; I can wait a little longer if it's going to go higher ... . The natural alternative to this setup would be RUT with similar strikes -- i.e., 1120/1160/1260/1300 ... .