IV Percentile

IV Percentile measures the percentage of trading days over the past year where implied volatility was lower than the current level. If IV Percentile is 85%, it means that on 85% of trading days in the past year, IV was below where it is today. This makes it a frequency-based measure rather than a range-based measure like IV Rank.

The distinction matters more than most traders realize. IV Rank can be misleading when a stock has a single extreme spike in volatility. For example, if a stock typically trades at 20-25% IV but spiked to 80% during a one-day event, its 52-week range is 20% to 80%. If current IV is 30%, IV Rank would show just 16.7% — suggesting options are cheap. But IV Percentile might show 75%, because the stock rarely trades above 25%. IV Percentile gives you a more accurate picture of how unusual the current IV level truly is.

For this reason, many professional options traders prefer IV Percentile over IV Rank for making strategy decisions. Options Pilot uses both metrics within the Value pillar because they provide complementary information. IV Rank tells you where IV sits within its range, while IV Percentile tells you how common or rare the current level is. Together, they paint a much clearer picture than either metric alone.