The Outlier Trading Podcast Euan Sinclair: Can You Predict the Next Big Market Move?
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Sep 14, 2025 
Euan Sinclair, a quant trader and volatility expert, shares his insights on market predictions and the current behavior of the VIX. He discusses the rise of leveraged ETFs and the risks they pose for long-term traders. Euan highlights effective trading strategies, such as delta-hedging and managing rebalancing costs. He emphasizes the importance of mental models and understanding market psychology while cautioning against overconfidence. Finally, he explores the complexities of volatility trading and the factors impacting options pricing.
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Why VIX Stays Sticky During Rallies
- VIX can remain sticky even as the market rises because realized short-term time-series volatility is low while realized price moves can still be large.
- Market structure and ETF upside flows make certain call strikes unusually cheap right now.
Buy Meaty Calls When Upside Is Cheap
- Consider buying meaty calls (20–40 delta) into upside moves instead of only selling zero DTEs, because those calls have been priced cheaply.
- If short, pair them with a broader short wing or strangle to manage exposure.
Structured Flows Can Compress But Not Erase Premium
- A huge volume of structured products selling upside has compressed certain option premia but hasn't eliminated variance premium.
- Flow imbalances can persist until other buyers or failures rebalance the market.