IV rank vs IV percentile

Two common definitions

IV rank = (today's IV minus the lowest IV in the period) divided by (highest minus lowest). One spike can make everything else look low.

IV percentile = the share of days in the period when IV was lower than today. It is less distorted by a single outlier.

How ClearStrike defines them

On ClearStrike, both the index 'IV rank' and the stock 'IV percentile' are of the percentile type: the share of past comparable days with lower ATM IV. For stocks we compare with the last year at the same point of the expiry cycle, because IV tends to behave differently at different distances from expiry.

For MCX, we show no rank yet: it needs at least 15 days of history and we only have a day or two so far.

How to use it

A high number means options are expensive relative to that instrument's own history; a low number means cheap. It is a description of pricing, not a prediction of direction or a trading signal.