One question, one number
Most premium sellers check VIX and call it a day. But VIX only measures expected volatility — it doesn't tell you if that volatility is priced in your favor. The Weather Score combines five signals into a single 0–100 reading that answers: should you be selling premium today? When the score is high, the market is overpricing risk. When it's low, the edge isn't there.
What goes into the score
Five signals, each weighted by how well it predicts premium-selling outcomes. Premium Edge (30%) — what percentage of S&P 500 stocks have positive VRP (the core edge). VIX Regime (25%) — is VIX in the ideal 15–25 range for selling, not too low, not crisis-level. Volatility Trend (20%) — is realized volatility declining across the index. Earnings Safety (15%) — how many stocks have earnings soon (more = riskier). Term Structure (10%) — VIX vs VIX3M contango or backwardation.
Three regimes, three actions
Favorable (65–100): Options are overpriced broadly. Open new positions with standard sizing. Selective (40–64): Mixed signals. Only trade tickers where Scanner shows strong individual setups. Defensive (0–39): The edge isn't there. Sitting out protects your capital — one bad trade on a Defensive day costs more than weeks of patience. VolRadar backtesting shows VRP was positive 73% of the time when the Weather Score was at least 65 (Favorable), 54% when Selective (40–64), and only 31% when Defensive (below 40) (in-sample, past performance not indicative of future results).
Weather sets the pace, Scanner picks the names
The Weather Score is a market-wide reading — it tells you WHEN to sell. The Scanner tells you WHAT to sell. Even on a Favorable day, individual tickers near earnings or with negative VRP are bad trades. Conversely, on a Selective day, the Scanner might find 2–3 strong setups worth taking. Use both together: Weather for your overall risk budget, Scanner for specific names.
Why S&P 500 only
The score is computed exclusively from 500+ S&P 500 stocks — no ETFs, no small caps. This makes it a consistent, comparable benchmark over time. When we say "72% of stocks have positive VRP," that means 72% of the S&P 500, every single day, same universe. The Scanner can expand to thousands of tickers independently — Weather stays fixed for reliability.