Which is better, rank or percentile?

They answer slightly different questions; many traders look at both.

Commonly 52 weeks or one year of observations.

Options WhaleEarnings volatility research

Concept guide

IV Percentile

IV percentile is the share of historical observations that sit below the current implied volatility.

Concept

Formula

IV Percentile = observations below current IV / total observations

What it measures

IV percentile describes the current implied volatility relative to the whole distribution of past readings. A reading of 80% means current IV is above 80% of the observations in the window.

Why it can be more useful than rank

Because it uses every observation rather than only the high and low, a single outlier spike affects percentile less than it affects rank.

FAQ

Which is better, rank or percentile?: They answer slightly different questions; many traders look at both.
What window is used?: Commonly 52 weeks or one year of observations.