IV rank vs. IV percentile

 这两个概念很容易混淆。

If IV Rank tells you where volatility sits, IV Percentile tells you how unusual that level is.

IV Rank measures where current IV sits relative to its high and low range over the past year, scoring it from 0 to 100. 

A rank of 0 means the IV is at its lowest for the year, and 100 is the highest.

Example: if IV was between 30 and 60 in the last year and is 45 now, its IV rank would be 50.

IV Percentile measures the % of days over the past year where IV was lower than it is today. 

Example: an 80% IV Percentile means the current IV is higher than 80% of the days in the past year, indicating high volatility now.

波动性不是静态的，它往往趋向均值回归Mean Revert

这两个值要一起看，帮助做决定

1. both are high

Options are expensive, suitable for premium selling strategies.

2. both are low

Options are cheap, 适合买期权

3. The two are diverge

比如当前的情况，3月27日收盘时，SPY显示IV Rank=45,  IV Percentile=95。

这种情况往往表明过去一年期间有波动率飙升的事件，把IV的range streched。 所以看IV Rank好像不高，但现在的波动率已经处在顶部范围。

总结：

The real edge comes from combining all three tools into a single workflow.
A trader might start by scanning unusual options activity to identify where something is happening. They then check IV Rank to understand how that opportunity is priced, and IV Percentile to determine whether that pricing is normal or stretched.