The Delta Vega Combo on Underwater Positions

<p>As premium sellers, we are in a unique position whenever we need a stock to rally back on an underwater naked position. Specifically, being long delta and short vega could benefit us in two ways if the stock were to rally. Not only would a rally in the stock help the position due to its positive delta, but that same rally would <a href="http://ontt.tv/2b1vIHe">likely be accompanied by a drop in volatility</a>. This means that our position’s <a href="http://ontt.tv/1UNUgrv">short vega</a> could benefit from the volatility contraction. </p><p>With our portfolio, we see both factors contributing to our PINS position.</p>