How do you find the IV value?

The question "How do you find the IV value?" is incomplete, as 'IV' can refer to several things. Based on the provided context, let's assume IV refers to Implied Volatility (IV) Percentile. Therefore, the question becomes: "How do you find the Implied Volatility (IV) Percentile?".

To find the IV percentile, you must first gather the Implied Volatility Percentage (IV%) for every trading day over the previous year, which is 252 trading days. Then, you determine how many of those previous 252 days had an IV% below the current day's IV%. Finally, to get the IV percentile, you divide that number by 252. This gives you the IV percentile, or where the current day's IV% stands compared to the previous year's range.

Calculating Implied Volatility Percentile

Here's a step-by-step guide to calculating the IV percentile, according to the reference:

1. Gather Historical IV% Data: Collect the IV% for each of the previous 252 trading days.
2. Compare to Current IV%: For each of the 252 days, determine if the IV% was below the current day’s IV%.
3. Count the Number of Days: Count the total number of days where the previous IV% was below the current IV%.
4. Calculate the IV Percentile: Divide the number of days found in step 3 by 252 trading days. The result is your IV percentile.

Example:

Let's assume the following:

• Current day's IV%: 25%
• Number of previous days with IV% below 25%: 100

Then, the calculation is:

• IV Percentile = 100 / 252 = 0.3968 or roughly 39.68%

This indicates that the current implied volatility of 25% is higher than 39.68% of the previous year's trading days.

Importance of the IV Percentile

Understanding where the current IV falls within its historical range can be valuable for trading and options strategies. A high IV percentile may indicate that implied volatility is currently high relative to its recent past, whereas a low percentile may suggest that it is lower.