Options Wonderland

[Fox13]

“Da Boyz” have another trick up their sleeve:

VIX is dropping severely while the market is slowly climbing. Al index-options subsequently drop, BUT the slope of decay is steeper for Nov & Dec than for the front month! Thus the Option Market is subjected to a phenomenon known as progressive “backwardation” or “vacudation” in the lingo of Vini-the-Trader...
That means that those guys like me who have time spreads are loosing virtual $…for the time being…
Some people think that when this is happening , the VIX drop cannot last…