It's up to the individual trader and their assumption. If I am neutral on an underlying and IV is high, I might choose an iron condor, straddle, strangle, or iron fly.
If I'm bullish and IV is low, maybe I'll look at a long call spread or a poor man's covered call.
If I'm bearish and IV is high, maybe I'll look at a short call or short call spread.
There's no right or wrong answer, we just prefer to sell premium when IV is high, buy premium when IV is low, and make sure our probability of success is over 50%!
RUT (broken wing butterfly) - (riskless trade)
1505 -put +1
1500 -put -2 {3 dollar credit $1200 margin call}
1480 -put +1
repair the broken wing
buying vertical 1495 +1 (1 dollar debit )
sell 1480 -1
in case disaster:
(1495)if the price goes below the short strike ( get out then you will assignment fee)
