- Put premiums are higher than call premiums under similar conditions
- Premiums are higher when the short option bid and ask prices are narrower
- Premiums are higher when open interests are larger
- Premiums are higher when Delta differences between short and long strikes are larger
- Premiums are higher when the IV differences (Skew) between short and long strikes are smaller
- Premiums may not be higher with longer DTE in the analyzed range
- Higher IV of the option does not guarantee higher premium
My biggest surprise is that the higher IV's do not always provide higher premium or ROC. In October turbulent trading, I could obtain higher ROC as IV was much higher in those days. But now, the IV of TLT is still high and yet its option premiums offer less ROC. I found other more liquid options (i.e. IWM) offer reasonable ROC (>10%) at the same time. The only reason I could find so far was the lack of open interests in the options. So I would conclude the lack of option liquidity means lower ROC for option sellers and the middle option price of bid and ask may not be fair.
In general, I believe this is one way for option sellers to estimate the fairness of option premiums as they use options of similar parameters for the comparison.