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Part two of Mike Butler's implied volatility run on Options in Action, and it clears up a trap that catches a lot of premium sellers. IV rank and IV percentile both tell you where implied volatility sits relative to its own 52 week range, which is useful context, but a high IV rank does not mean there is actually much premium to sell. A product can read a 90 IV rank while its actual implied vol is only in the twenties, basically pennies for the risk. 📊 tastylive: tastylive.com 📰 Get Tom's pre-market analysis every morning: tastylive.com/newsletters 📘 FREE Options Strategy Guide: tinyurl.com/bp9ms763 📱 Follow tastylive on X: x.com/tastyliveshow Chapters 00:00 Part two of the IV series 00:30 What IV rank actually measures 01:17 When rank goes above 100 or below zero 02:14 Adding IV percentile to your watch list 03:54 How IV percentile is different 04:22 Why it smooths out spikes 05:20 IVX is what really matters 07:19 The PayPal example 08:18...
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