IV Rank
IV position within 52-week high-low.
Definition
A normalized score 0-100 describing where current implied volatility sits between its 52-week low and high. 0 means IV is at the trailing-year low, 100 means it's at the trailing-year high.
Formula
IV_rank = (IVcurrent − IV52w_low) / (IV52w_high − IV52w_low) × 100
Uses only the min and max of the 252-day window — sensitive to single-day spikes.
Inputs
current IV52w high IV52w low IV
Output
iv_rank (0-100)
Interpretation
- High (>80): IV near 52w highs — premium-selling regime.
- Low (<20): IV near 52w lows — long-vol / long-premium regime.
- Mid (20-80): IV in normal range; no clear vol edge.
API Reference
Endpoint
GET /v1/volatility/{symbol}
Tier
Basic
Response field
iv_rank
Why IV Rank Matters for Trading
TL;DR
IV Rank is the 0-100 version of "is vol high or low?" It normalizes premium-richness so you can compare SPY, TSLA, and a biotech on the same axis.
- What it measures
- Current IV's position within its own trailing-52-week high-low range, as a 0-100 score.
- What it signals
- Whether premium is historically rich or cheap for this specific name.
- Why we measure it
- Raw IV is not comparable across names. Rank turns a name-specific number into a universal signal.
- Who uses it
- Credit-spread sellers, iron-condor traders, calendar-spread buyers, screen-scanners.
How to read IV Rank
High (>80)
- Premium rich vs trailing year
- Short strangles, iron condors
- Watch for mean-reversion in IV
- Pair with VRP check
Good for: premium sellers
Low (<20)
- Premium cheap vs trailing year
- Long straddles, calendars
- Good setup for vol-expansion trades
- Earnings plays favored
Good for: long-vol buyers
Mid (20-80)
- IV in normal range
- No vol-level edge
- Trade direction, not vol
- Wait for IV regime extreme
Neutral
Rules of thumb
- Rank is outlier-sensitive. One COVID spike can anchor IV_high for 12 months. Cross-check with IV percentile.
- Rank > 50 is tastytrade's threshold for premium-selling candidates, but pair it with VRP and realized-vol history.
- Earnings distort rank. Back out known-event IV spikes before comparing to non-event dates.
- Use 30d IV as the input for consistency across tenors. Longer tenors move slower and rank less usefully.
- High rank ≠ rich vol. Always cross-reference with realized vol — vol can be high and still underpriced.
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