We really don’t know which scenario it is (A or B). But we’re not adjusting our long volatility portfolio in a major way right now other than some modest position rotation. If it’s (A) then we will suffer giveback. But we don’t think we’ll revisit the lows in implied volatility now that this event has happened.
This move shows all the signs of being the beginning of something big and we won’t see the same cheap levels to get in again.