Some options have a bid/ask midpoint higher than their B&S theoretical value, while others have one lower. I obviously know that this is not a tool to derive edge from, but I am wondering what it means when an option is for sale at a price less than its theoretical value, and what the opposite means.
For example, if bid+ask/2 > theoretical value, does that mean price is experiencing greater IV than predicted?
Similarly, if bid+ask/2 < theoretical value, does that mean price is experiencing less IV than predicted?
Thanks to all for your wealth of knowledge :)