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To identify volatility arbitrage opportunities, you analyze the implied volatility surface for mispricings in smile, skew, and term structure. This process uses SABR or local-vol calibration to isolate discrepancies across equity and ETF options contracts.

SABR and local vol calibration differ in modeling the volatility smile and skew dynamics for options skew trading. SABR captures stochastic volatility dynamics, while local vol maps implied volatility directly to underlying spot price variations for trade selection.

You manage delta, vega, and gamma exposures for delta-hedging strategies by applying specific risk control rules and hedging frequency heuristics. This ensures proper gamma-scalping breakeven checks and maintains balanced Greeks during market fluctuations.

Yes, you can use volatility surface analysis for equity and ETF calendar spreads. The analysis evaluates near-month versus far-month implied volatility term structures to recommend specific entry, exit, and margin buffer controls.

Margin and expiry risk controls for options market-making scenarios involve specific margin buffer guidance and expiry-week sizing adjustments. These rules prevent over-leveraging and manage gamma risk as contracts approach expiration.

You should not use a skew-driven risk reversal when the implied volatility surface shows flattened skew dynamics or insufficient term structure discrepancies. This avoids entering low-probability trades without clear volatility arbitrage edges.