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Composite: 86.6/100. All five factors confirm — implied vol is systematically rich vs. realized. 30-day average: 71.1. Short premium structures are supported by broad VRP.
30-day average 71.1 — sustained favorable regime
Conditions favor premium selling (score 86.6/100).
VolRadar Weather Score
2026-04-02 close · Updates daily ~6:00 PM ET
Yes — Conditions Favor Sellers
VRP is wide across the board. Full allocation warranted.
“Broad VRP, contained realized vol, and stable term structure. The setup is there.”
What to do today
Recommended
Liquid index and mega-cap names outside earnings window
Avoid
Earnings within 7 days, illiquid single names
Structures
Iron condors, short strangles, short puts
DTE
30–45 DTE preferred
Sizing
Full allocation
Favorable regime does not eliminate tail risk. Gap risk and correlation spikes persist regardless of score.
■ ≥65 Favorable · ■ 40–64 Selective · ■ <40 Defensive
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Weather Score identifies the regime. Scanner surfaces the individual opportunities.
View setups →S&P 500 universe · EOD options data from ORATS + CBOE
Identical VIX level. Same strategy. Opposite outcome. The compositei captured what a single factor missed.
SPY iron condor at VIX 18. Same level, opposite outcome.
VIX ~18 on both days
SPY realized 0.9% over 5 days. Wings at +/-2.3%. Full premium captured.
SPY realized 3.1% over 5 days. Wings at +/-2.3%. Position breached.
VIX: ~18 both sessions. The differentiator: composite regime classificationi
VIX read 18 both sessions. Composite identified collapsing VRP breadth and inverted term structure on the Defensive day. The single-factor VIX signal was masking deteriorating conditions beneath the surface.
VIX at 26. Elevated implied vol — but is the VRP actually there?
VIX ~26 on both days
VIX mean-reverted to 20. Short premium collected the reversion.
VIX accelerated to 35. Short premium positions faced margin calls.
VIX: ~26 both sessions. The differentiator: composite regime classificationi
Elevated VIX does not guarantee positive VRP. On the Defensive day, realized vol was expanding, VRP breadth was collapsing, and the term structure had inverted. The composite flagged adverse conditions while VIX alone suggested opportunity.
Illustrative scenarios based on historical regime patterns. See VRP validation section for measured outcomes.
Computed daily from ORATS + CBOE end-of-day options and volatility data.
Premium Edge (VRP Breadth)
Percentage of S&P 500 constituents where implied vol exceeds realized vol. Measures breadth of the volatility risk premium across the index.
VIX Regime
Evaluates VIX level relative to the 15-25 mean-reversion zone. Applies spike penalty for 5-day VIX changes exceeding +3 pts.
Volatility Trend
Percentage of constituents where 10-day RV is contracting vs. 20-day RV. Declining realized vol supports short premium positioning.
Earnings Safety
Inverse of earnings density (% of S&P 500 reporting within 7 days). Lower density reduces binary event risk for short premium.
Term Structure
VIX/VIX3M ratio. Contango (ratio < 1) indicates normal term structure. Backwardation (ratio > 1) signals acute near-term stress.
Score = (VRP×0.30) + (VIX×0.25) + (RV×0.20) + (Earn×0.15) + (TS×0.10)
Each factor normalized to 0–100 (higher = more favorable for short premium). Composite output: 0–100.
Five days captures the typical weekly options cycle (Mon–Fri). It balances signal decay against a meaningful outcome window for short premium strategies.
Fixed universe ensures perfect historical comparability. Adding or removing tickers would change the score retroactively, breaking validation integrity.
VIX measures the level of implied vol, not whether it exceeds realized vol. The composite adds VRP breadth, RV trend, earnings density, and term structure — the full picture.
Weather Score determines the regime. Scanner ranks individual tickers by VRP, implied vol, and liquidity within that regime.
Free Scanner: 5 tickers · Starter: full rankings, alerts, and historical VRP data
Weather Score is free · Recalculated daily after close
Composite deteriorated by 0.7 pts, led by vix regime, partially offset by premium edge.
Regime validation rate
79.5%
Favorable regime
831 trading days
Implied vs. realized edge
81.5%
All regimes
1301 observations
Score-range hit rate
95.3%
At score 87
Your current decile
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Weather Score is an analytical tool for informational purposes only. It does not constitute financial advice, a recommendation to buy or sell any security, or a guarantee of future performance. Historical model accuracy is not indicative of future results. Options trading involves substantial risk of loss and is not suitable for all investors. Conduct independent analysis and consult a qualified advisor before executing any strategy.
VRP hit rate: Percentage of sessions where forward 5-day VRP breadth remained ≥50% (majority of S&P 500 constituents with positive implied-minus-realized vol spread).
Regime classification: Favorable (composite ≥65), Selective (40–64), Defensive (<40).
Calculation cadence: Recalculated daily at ~6:00 PM ET from end-of-day data (ORATS + CBOE).
Validation sample: 1320 trading sessions (2020-01-01 — 2026-04-02). Forward validation excludes the most recent 5 sessions (pending resolution). Data sources: ORATS, CBOE. Universe: S&P 500 constituents only.