Custom Script for IV Rank and IV Percentile on ThinkorSwim

In today’s video we’ll learn how to add a custom script for IV Rank and IV Percentile on each of our charts. If you trade options, being able to see volatility as well as a way to measure that volatility is incredibly important. Probably the most popular out there being IV rank, followed closely by the IV percentile although many platforms don’t offer this one. As I mentioned, each of these is used to uncover whether implied volatility is high or low compared to the past year. IV rank is by far the more popular of the two, but has some downsides. Because the calculation for IV rank uses the yearly low and high, it can be skewed if there has been a large swing in volatility in the past year. IV RANK = Current IV – 52WH / 52WH -52WL IV Percentile acts in a very similar manner, but attempts to counteract the affect of a large swing in volatility in the past year. It simply looks back the past year and looks at how many days volatility has been below the current volatility. IV Percentile = # of Days Below Current IV / # of Trading Day