Short premium
Short premium and IV crush: risk is not gone
Selling elevated implied volatility can benefit from IV crush, but the trade is exposed to gap risk, assignment, liquidity, and losses that can exceed the premium collected unless risk is defined.
Comparison
StructurePotential IV benefitMain riskRisk control
Short straddleHighLarge move either waySize small or avoid undefined risk
Iron condorModerateMove beyond short strikesDefined width and planned exit
Debit spreadLowerStill needs directional moveDefined debit paid
IV crush can be a tailwind for short premium, but it is not a shield against a stock that moves far beyond the expected range.
Primary reading: OIC implied volatility overview · OIC Vega guide · OIC volatility and Greeks · FINRA options basics and Greeks · SEC Investor Bulletin on options