Can any experienced traders comment on the rreliability of an increase in volatility brought on by movement in one direction offsetting the price decrease of the opposite direction long option?
In other words, does an increase in volatility brought on by a sharp jump in price cause puts to not decrease in price as much as would be expected if the same movement happened more slowly? Also, is the market rationalin that what applies for the above also applies to a sudden drop scenario and its…