Implied volatility (IV)
Implied volatility, or IV, is how big a move the market expects, worked backwards out of the option's price. High IV means options are expensive, low IV means they are cheap.
In depth
IV says nothing about direction, only about size. If the market expects a stock to swing hard over the next month, everyone wants protection, option prices rise, and IV rises with them. A quiet stock in a quiet week has low IV and cheap options. Earnings are the clearest case: IV climbs into the announcement.
That creates a trap. You buy calls before earnings, the stock rises five percent as you hoped, and the calls still lose money. The event passed, the uncertainty went with it, IV fell and took the premium down more than the move added. That drop is called IV crush.
Why it matters
IV decides what you pay, and what you pay decides how right you have to be. Buy an option when IV is high and the stock has to move further just to get you back to even. Buy when IV is low and a modest move can pay. Checking IV before you buy is a two-second habit.
TraderLog does not store IV on a trade. What it does show is the damage. Tag the trades you took into an event and the By tag table compares them with the rest, alongside results per symbol and by hold time on the stats page.
Frequently asked questions
No. IV only says the market expects a big move, in either direction.
Before scheduled events like earnings, and during market-wide selloffs when everyone wants protection.
Keep your Implied volatility (IV) trades on the record in TraderLog
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