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implied volatility rank mean reversion

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In plain terms

When fear in the options market is at a one-year high the stock tends to bounce back, and when it is unusually calm the stock tends to slip.

How it works

Implied volatility is strongly mean-reverting; a very high IV rank typically coincides with fear/capitulation that subsequently recovers, while a very low IV rank marks complacency. IV rank is where current IV sits in its trailing 1-year range (0-100).

Live results

11 times picked on its own · 23 times inside a blend (21 beat the stock) · updated 2026-06-06
This strategy is a frequent ingredient in blends that combine a few strategies on one stock. It has contributed to 23 such blended picks (21 of which beat simply holding the stock). Picking it on its own is only one of the ways it shows up.
How its picks scored vs. buy & hold
Each pick is graded on a recent year it was never tuned on, against simply owning the same stock
Where its edge concentrates
Share of picks in each company-size group that beat buy & hold
How often it trades
Active vs. patient. Bars on the left mean it waits for rare setups; bars on the right mean it trades often
Return vs. buy & hold
How much each pick beat or trailed simply owning the stock over the test year (extreme microcap moves trimmed)
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Data dependencies

  • Options surface daily

    End-of-day OPRA option chains used by IV-skew family.

  • Daily prices

    Adjusted-close OHLCV for every US-listed ticker; primary price feed.

Expected edge

Trades the recovery from option-market fear extremes and the fade of complacency, keyed off the forward IV percentile rather than realized vol.

Related families

Explore implied volatility rank mean reversion on alphactor.ai

See which tickers this family is currently firing on, with live signals and rankings.

For informational and educational purposes only. Not financial advice. Learn more