IV Crush
The rapid decline in implied volatility — and therefore option premiums — after a major event like earnings.
Explained Simply
Before a binary event like earnings, options prices inflate because the market is pricing in uncertainty. After the event, that uncertainty disappears and IV drops sharply — often 30-60% overnight. This is IV crush. Even if you correctly predict the direction of the stock move, your option can lose money if the IV crush more than offsets the directional gain. IV crush is the #1 reason beginners lose money buying options before earnings.
How Tradewink Uses IV Crush
Our earnings play signals explicitly account for IV crush. We calculate the "expected move" priced into options and compare it to the AI's predicted move. We only recommend buying options pre-earnings when our predicted move significantly exceeds the priced-in move. We also generate premium-selling strategies that profit from IV crush.
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See IV Crush in action
Tradewink uses iv crush as part of its AI trading signal pipeline. Start getting signals that use this concept to find real opportunities.