Conditioned Reflexes of End-of-Term Options: Volatility Sensitive: Decreased IV/volatility and risk premium on end-of-term options can lead to losses even if the price remains unchanged or the direction is correct – IV decay. Time Sensitive: Pricing varies drastically between a few hours before and after settlement, especially in the hours leading up to expiration. The same underlying asset price an hour later can result in vastly different option prices – theta decay. Slope Sensitive: A slower or faster rate of increase than expected significantly impacts option prices.