Worry on the Street

As an option trader there are a few things that I look at each and every day and one of them is Vega. In the option world I have been seeing a lot of volatility bulls (traders that want volatility levels to go higher) putting on double calendar spreads. These bulls are also bearish on the market, and are looking for the "double dip" in equities. A double dip would push the $VIX back to old high areas, and Vega long traders will be hitting grand slams. There are a few ways to participate in a rise in volatility. If you think we will have a double dip you can buy puts or you could buy a doublecalendar. Either way I think volatility levels are going to rise.