Implied volatility inflates the price of an option’s extrinsic value; i.e., time value. When implied volatility rises, so do option prices because the time value associated with those options is more expensive. Conversely, falling implied volatility produces cheaper options.
If you buy options when implied volatility is high, you run the risk of a subsequent drop in implied volatility and a corresponding drop in the price of your options. As an option seller you can take advantage of the rich implied volatility levels and then buy back the same options after implied volatility subsides.
Buying options when implied volatility is low reduces the chance of a subsequent drop in values and positions you to profit should implied volatility rise.
