Traders of advanced options spreads might take a look at VIX call butterfly spreads. As an example, VIX September futures are about 80 cents (0.80) over the VIX Index, about 20.55 versus about 19.75. What is interesting, however, is the mid-point of the VIX September 20-22.50-25 call butterfly spread.
Take a guess: is this 2.50-point call butterfly spread pricing at .05, .15, or .30?
Do you believe 0.05? This is what happens when implied volatility is "high;" prices of butterfly spreads drop dramatically. And the implied volatility of VIX options is north of 70% (depending on strike and expiration).
If you can get such a butterfly spread on for .05 or .10, then that plus commissions is your maximum risk. The hope would be that "things quiet down after the debt ceiling issue is resolved." And then – it is hoped – the butterfly spread would rise in price (as the implied volatility of VIX options falls).
I will keep my eyes on this one and report back later.