Long vol
Definition · Level 2 · Long options & hedges
Keep reading with Tradecraft
Without an account, you can read three definitions every 30 days. Tradecraft explains all 738 terms and strategies, with the lessons that teach them, flashcards that come back before you forget, quizzes and a payoff lab.
Positioned to profit from large moves or rising implied volatility, typically by owning options: long gamma and vega, paying theta. Wins if IV rises or realized volatility beats the implied you paid.
Example
“We’re long vol into the Fed — we own the straddle.”
Where Tradecraft teaches it
Level 2 · Long options & hedges, in the lesson “Buying volatility: straddles, strangles, long iron condors”: Expect a big move but can’t call the direction? Buy both sides.
Related terms
- Event tradeA position built around a scheduled catalyst — earnings, an FDA decision, a court ruling — e.g. buying a straddle just before and closing soon after.
- Implied moveThe move the options market is pricing for an event — roughly the price of the ATM straddle in the first expiry after it; buying that straddle needs…
- IV crush (vol crush)The sharp drop in implied volatility right after a scheduled event (earnings, FDA ruling) resolves the uncertainty, deflating time value; long…
- Long gammaOwning options so that your delta grows in the direction the stock moves — longer as it rallies, shorter as it falls — so large moves either way help.
- Long Iron CondorA long put spread plus a long call spread.
- Long StraddleBuy a call and a put at the same strike. You don’t care about direction — you need the stock to move more than the combined premium.