Implied Volatility Advanced How the smile moves when spot moves Forward-looking

Sticky Strike

The regime where the curve stays put and the market walks along it.

Quick answer: Sticky strike is the volatility-surface regime in which each strike keeps its own implied volatility fixed as spot moves, so the curve stays glued to strikes and the at-the-money option — now a different point on that fixed downward-sloping curve — prints a lower implied volatility when spot rises.

In simple words

There are only a few ways a volatility skew can move when the underlying moves, and sticky strike is the simplest one: the curve does not move at all. Imagine the downward-sloping NIFTY skew drawn against strike. Under sticky strike, that whole curve is nailed to the strike axis. When spot rises from 24,000 to 24,600, the curve stays exactly where it was, and the market simply walks to the right along it. Because the curve slopes down, the new at-the-money point — now the 24,600 strike — sits lower on the curve than the old one did, so at-the-money implied volatility falls, in this example from about 12.8% to about 11.4%. Nothing about any individual strike changed; each strike kept its own volatility. What changed is which strike is now "at the money".

The name is literal: implied volatility is sticky to the strike. The 24,000 option keeps its 12.8% whether spot is at 24,000 or 24,600 — its volatility is a property of the number 24,000, not of how far it happens to be from spot today. This is the regime you tend to see in calm, range-bound markets, where the smile is a stable, familiar shape that the market drifts back and forth across without redrawing it. It is the opposite bookkeeping to sticky delta, where the whole curve slides sideways with spot and the at-the-money volatility never changes.

Not to be confused with: Sticky delta, the mirror-image regime. Under sticky delta the curve slides sideways with spot, so at-the-money implied volatility stays constant and every individual strike's volatility changes. Under sticky strike the curve stays fixed to strikes, so at-the-money volatility changes and every individual strike's volatility stays constant. They make opposite predictions about the same event, and which one is closer to true decides whether a delta hedge is really a hedge.

The picture

The curve never moved — spot slid along it

The skew stays fixed to strikes as spot rises from 24,000 to 24,600.

The implied-volatility curve is drawn against strike and does not move when spot rises 600 points. Because the curve is glued to strikes and slopes downward, the at-the-money option is now a different, higher strike sitting further down the curve, so at-the-money implied volatility falls from about 12.8% to about 11.4%. Each individual strike kept its own implied volatility — this is the calm, range-bound regime, and the reason a flat-vol delta needs correcting.

Professional explanation

What 'sticky strike' actually asserts

Sticky strike is a statement about dynamics, not about the shape of the smile at a single instant. Any downward-sloping skew is compatible with sticky strike; the regime is the extra claim about what happens next. Specifically, it asserts that the implied volatility of an option identified by its strike does not change when spot moves. The 24,000 strike prints 12.8% today with spot at 24,000, and it will still print 12.8% tomorrow if spot has drifted to 24,600 — its volatility is attached to the number 24,000, full stop. The visible consequence is that the at-the-money volatility must fall as spot rises, because "at the money" is now a different, higher strike sitting further down the same fixed downward-sloping curve. So sticky strike quietly builds in a negative relationship between spot and at-the-money volatility: spot up, at-the-money volatility down. That is empirically the right sign for equity indices, which is one reason sticky strike is a reasonable first approximation in quiet markets — the leverage effect and the skew both push the same way.

Why calm, range-bound markets tend to print it

Sticky strike is the natural regime when the market has a stable view of risk and is merely wandering within it. In a range-bound market, traders have a settled sense of what each strike is worth as insurance — the 22,000 put is the crash strike, the 25,000 call is the melt-up strike — and small movements in spot do not change those assessments. So the strikes keep their volatilities and spot drifts back and forth across a curve that everyone already agrees on. The regime tends to break precisely when the market stops being range-bound: in a strong trend, or a genuine repricing of risk, the whole curve gets redrawn rather than merely traversed, and the market moves toward sticky delta or something more violent still. This is why sticky strike is best understood as the calm-weather regime — a good description of a market that is moving without changing its mind, and a poor one of a market that is changing its mind.

The consequence for your delta, and its sign

Here is the practical payoff, and it is the sentence a trading-desk brochure would rather not print: your naive delta is wrong under sticky strike, and the correction has a definite sign. The general result is that the true, minimum-variance delta of an option equals its Black–Scholes delta plus vega times the rate at which that option's implied volatility moves as spot moves — Δ_adj = Δ_BS + ν·(∂σ/∂S). The entire content of a regime is the value it assigns to that ∂σ/∂S term. Sticky strike makes a clean claim: for an option identified by its strike, ∂σ/∂S is zero, because the strike keeps its own volatility as spot moves. So the honest, and slightly deflating, sticky-strike result is that the correction term vanishes and the correct hedge ratio is the ordinary Black–Scholes delta computed at each strike's own implied volatility. The mistake that sticky strike corrects is therefore not a dynamic one — it is using a single flat at-the-money volatility for every strike. Do that under a skew and you misprice the delta of every option that is not at the money; use each strike's own volatility and, under sticky strike, you are hedged.

The sign that flips, and why the regime matters at all

If the sticky-strike correction is zero, why does the regime matter? Because the alternatives are not zero, and getting the regime wrong flips the sign of a real correction. Under sticky delta — the trending-market regime — a fixed strike's volatility does change as spot moves, because the curve slides sideways, so ∂σ/∂S is positive for equity skews and the true delta sits above the Black–Scholes delta. Under an even more aggressive regime, sometimes called sticky local volatility, the smile moves down more than one-for-one as spot rises, ∂σ/∂S is negative, and the true delta sits below the Black–Scholes delta — which, empirically, is where index markets often actually are. So the three regimes bracket the truth with corrections of opposite sign, and sticky strike is the zero point in the middle. A trader who assumes the wrong regime does not merely mis-size the correction; they can apply it in the wrong direction, and a hedge corrected the wrong way is worse than no correction at all. That is why a whole page exists for what looks, at first, like an accounting convention.

Contrast: the sticky-delta regime slides the curve

The same 600-point move under the opposite regime.

Placed side by side, the two regimes are opposite bookkeeping. Sticky strike holds the curve fixed and lets at-the-money volatility fall; sticky delta slides the whole curve right with spot and keeps at-the-money volatility unchanged. The same 600-point rise produces a falling at-the-money volatility in one regime and a flat one in the other — which is why you cannot hedge without an assumption about which regime you are in.

Formula

The delta the regime forces on you

Δ_adj = Δ_BS + ν · (∂σ/∂S)

The true, minimum-variance delta of an option is its Black–Scholes delta plus vega times how fast the option's own implied volatility moves as spot moves. A volatility regime is precisely an assumption about the term ∂σ/∂S. Under sticky strike, an option identified by its strike keeps its volatility as spot moves, so ∂σ/∂S ≈ 0 and Δ_adj ≈ Δ_BS — provided Δ_BS is computed at that strike's OWN implied volatility, not at a single flat at-the-money volatility. The regime's real bite is that the other regimes make ∂σ/∂S non-zero and of opposite signs, so assuming the wrong one corrects your delta in the wrong direction.

Δ_adjThe regime-adjusted (minimum-variance) delta — the hedge ratio that actually minimises the variance of the hedged position.
Δ_BSThe Black–Scholes delta, computed at the option's own implied volatility. It is the whole answer only when ∂σ/∂S is zero.
νVega — the option's sensitivity to a change in implied volatility, per one percentage point of volatility, per unit of the underlying.
∂σ/∂SThe rate at which the option's implied volatility changes as spot moves. This single term is what a regime assumes. Sticky strike sets it to zero for a fixed strike.
SSpot price of the underlying — 24,000 for NIFTY here, rising to 24,600 in the worked example.

Sticky strike as a rule for the smile

σ(K, S) = f(K), so ∂σ_ATM/∂S = ∂σ/∂K (the skew slope)

Under sticky strike, each strike's implied volatility is a fixed function of the strike alone, independent of spot. The at-the-money volatility, however, does move: as spot slides along the fixed curve, ∂σ_ATM/∂S equals the slope of the skew itself. On a downward skew that slope is negative, so at-the-money volatility falls as spot rises — 12.8% to 11.4% for a 600-point move on the reference chart. A fixed-strike volatility is constant; the at-the-money volatility is not.

How to hedge under a sticky-strike assumption

Confirm the market looks range-bound and calm — sticky strike is the quiet-weather regime, and it is a poor description of a trending or repricing market.
For every option, read its implied volatility from its own strike on the current skew, not from a single flat at-the-money volatility. This is the correction sticky strike actually demands.
Compute each option's Black–Scholes delta using that strike's own implied volatility. Under sticky strike this is the hedge ratio — the dynamic correction term is zero.
Do not add a spot-volatility correction for a fixed-strike option, because sticky strike sets ∂σ/∂S to zero for it. Adding one would import a regime you are not assuming.
Track the at-the-money volatility separately: it will fall as spot rises and rise as spot falls, tracing the fixed curve, and that is expected behaviour, not a repricing.
Watch for the regime to break. If the whole curve starts sliding with spot rather than staying put, you are drifting toward sticky delta and your zero correction is no longer right.
Re-mark the skew after any large move and re-read every strike's volatility off the possibly-reshaped curve, because sticky strike constrains dynamics, not the curve's overall level.

Practical example

NIFTY worked example

NIFTY is at 24,000 and the reference skew prints the 24,000 strike at about 12.8%. Spot now drifts up to 24,600. Under sticky strike, the curve does not move, so the 24,000 strike still prints 12.8% — its volatility is glued to the number 24,000. But the at-the-money option is now the 24,600 strike, and reading it off the fixed downward-sloping curve gives about 11.4%. So at-the-money implied volatility has fallen from 12.8% to 11.4% purely because spot walked down the curve, even though not one strike changed its own volatility. Now the hedging lesson. Suppose you are short the original 24,000 call. To hedge it, you must use its own volatility — 12.8%, unchanged — to compute its Black–Scholes delta, and under sticky strike that delta is the correct hedge ratio with no further adjustment. The error to avoid is marking that call at the new, lower at-the-money volatility of 11.4%: 11.4% belongs to the 24,600 strike, not to your 24,000 call. Confuse the two and you will misprice your own position and mis-size the hedge.

BANKNIFTY worked example

BANKNIFTY makes the range-bound condition concrete. Suppose BANKNIFTY is chopping sideways in a 51,000-to-53,000 range with the market's view of risk settled, so it is behaving as sticky strike. The 52,000 strike prints about 15.5%, the 50,700 crash-hedge strike prints about 17.5%. Spot drifts from 52,000 up to 52,600. Under sticky strike the 50,700 put still prints 17.5% — the crash strike keeps its crash volatility — and the 52,000 straddle still prints 15.5%, while the new at-the-money 52,600 strike, sitting lower on the fixed curve, prints closer to 14.5%. The lesson that differs from the NIFTY one is about interpretation: a trader watching only the at-the-money number would see BANKNIFTY volatility "falling" from 15.5% to 14.5% and might conclude the market had calmed down. It had not. Nothing repriced; spot simply slid along a stationary curve. The falling at-the-money print is an artefact of the regime, not a signal — exactly the kind of thing that looks like information and is not.

Lot sizes used above (NIFTY 75, BANKNIFTY 30) are those in force at the time of writing; NSE revises them periodically. Figures exclude brokerage, STT, exchange charges, stamp duty and GST. Examples are teaching scenarios built on round numbers — they are not historical quotes, not backtests and not trade calls.

Risk note. Sticky strike is dangerous mainly through complacency. Because it produces a comforting zero delta-correction, it tempts a desk to keep hedging on the plain Black–Scholes delta after the market has stopped being range-bound and moved into a regime where the correction is large and non-zero. The regime does not announce its own end; it simply stops being true, usually in a trend or a shock, and a book still assuming sticky strike is then mis-hedged in a direction it cannot see. Treat the zero correction as conditional on calm, never as a permanent feature, and never let a falling at-the-money print under sticky strike be mistaken for the market genuinely calming down.

Advantages & limitations

What it is good for

It is the simplest regime to reason about, because the curve does not move — you can hold the whole skew fixed in your head and just slide spot along it.
It builds in the empirically correct sign for equity indices: spot up, at-the-money volatility down, matching the leverage effect and the shape of the skew without any extra assumption.
It gives a clean hedging rule in calm markets: use each strike's own volatility for its Black–Scholes delta and add nothing, because the dynamic correction is zero.
It is a good description of a range-bound market that is moving without changing its mind, which is a large fraction of ordinary trading days.
It makes the flat-vol error obvious. By insisting each strike keeps its own volatility, it exposes the common mistake of pricing every strike off a single at-the-money number.

Where it breaks down

It fails the moment the market stops being range-bound. In a strong trend or a genuine repricing of risk, the whole curve is redrawn rather than merely traversed, and sticky strike no longer describes the dynamics.
Its comforting zero delta-correction is only correct in the regime, so relying on it after the regime has ended leaves a book mis-hedged in a direction it cannot see.
It is an idealisation: real markets never hold a curve perfectly fixed, so sticky strike is at best a leading-order description that the actual smile deviates from every day.
It says nothing about the level of volatility, only about how the curve moves, so it cannot tell you whether the whole surface is about to lift or collapse.
It can generate misleading at-the-money readings. A falling at-the-money print under sticky strike looks like the market calming but is merely spot sliding along a stationary curve, which can be read as a signal when it is an artefact.

Common mistakes

Marking your own fixed-strike option at the new at-the-money volatility after spot moves. Under sticky strike your strike keeps its old volatility; the new lower at-the-money number belongs to a different strike, and using it misprices your position.
Hedging every strike off a single flat at-the-money volatility. Under a skew this misprices the delta of every non-at-the-money option; sticky strike's real instruction is to use each strike's own volatility.
Continuing to assume a zero delta-correction after the market has started trending. Sticky strike's zero correction is conditional on a range-bound regime, and in a trend the correct correction becomes large and non-zero.
Reading a falling at-the-money volatility under sticky strike as the market calming down. Nothing repriced — spot merely slid down a fixed downward-sloping curve — so treating the fall as a signal mistakes an artefact for information.
Adding a spot-volatility correction to a fixed-strike option's delta while assuming sticky strike. The regime sets that correction to zero for a fixed strike, so adding one imports a different regime and mis-sizes the hedge.
Assuming sticky strike is permanent. The regime ends without warning, usually in a shock, and a book that never re-examines the assumption is exposed exactly when the correction it ignored becomes largest.

Professional usage

Trading desks use the sticky-strike assumption as the default risk view in quiet, range-bound conditions, and they mark and hedge accordingly: each strike carries its own volatility, spot risk is hedged on the Black–Scholes delta at that own volatility, and no dynamic skew-delta correction is applied because the regime sets it to zero. Just as importantly, desks use sticky strike as a reference point against which to measure the real regime — they watch whether the at-the-money volatility actually falls as spot rises (consistent with sticky strike) or stays put (sticky delta) or falls faster than the curve implies (sticky local volatility), and they infer from that behaviour which correction their delta really needs. The regime is, in effect, a hypothesis the desk continuously tests against the market's own movement.

Risk managers treat the choice of regime as a model-risk parameter in its own right. Because the sticky-strike, sticky-delta and sticky-local-volatility assumptions imply delta corrections of opposite signs, a book's aggregate directional exposure depends on which regime is assumed, so a prudent risk function stresses the book under all three and sizes the worst case. Volatility arbitrage and structured-product desks are especially careful here, because a persistent regime misassumption produces a small, systematic, one-directional hedging error that quietly accumulates into a large realised loss — the kind of loss that does not show up in any single day's marks and is only visible in the drift of the hedged profit and loss over months.

Key takeaways

Sticky strike is the regime in which each strike keeps its own implied volatility fixed as spot moves, so the curve stays glued to strikes and the market simply slides along it.
Because the fixed curve slopes down, at-the-money volatility falls as spot rises — 12.8% to 11.4% for a 600-point move on the reference chart — even though no individual strike changed.
It typifies calm, range-bound markets where the view of risk is settled and small spot moves do not redraw the curve.
The dynamic delta correction Δ_adj = Δ_BS + ν·(∂σ/∂S) is zero under sticky strike for a fixed strike, so the correct hedge is the Black–Scholes delta at each strike's OWN volatility — the real error it corrects is pricing every strike off one flat at-the-money volatility.
The regime matters because the alternatives are not zero and have opposite signs, so assuming the wrong regime corrects your delta in the wrong direction — worse than not correcting at all.

Sticky strike is the calm-weather regime: the skew stays nailed to strikes and the market walks along it, so at-the-money volatility falls as spot rises while every individual strike keeps its own volatility. Its hedging lesson is quietly deflating — the dynamic delta correction is zero, and the real mistake it corrects is the lazy habit of pricing every strike off one at-the-money number. But the reason it earns a page is the sign that flips when the regime does: the alternatives correct the delta in opposite directions, and getting the regime wrong is worse than ignoring it. Sticky strike is the zero point between them, true only while the market is moving without changing its mind.

Frequently asked questions

What is sticky strike in simple terms?

Sticky strike is a volatility regime in which each strike's implied volatility stays fixed to its strike as spot moves. The whole skew curve stays glued to the strike axis, and the market simply slides along it. When spot rises, the new at-the-money strike sits lower on the fixed downward curve, so at-the-money volatility falls.

Why does at-the-money volatility fall when spot rises under sticky strike?

Because the curve is fixed to strikes and slopes downward, so when spot rises the at-the-money point is now a higher strike sitting further down that stationary curve. The at-the-money volatility falls not because anything repriced, but because "at the money" has become a different, lower-volatility strike. On the reference chart it falls from 12.8% to 11.4% for a 600-point rise.

What kind of market prints sticky strike?

Calm, range-bound markets tend to print it. When traders have a settled view of what each strike is worth as insurance, small spot moves do not change those assessments, so strikes keep their volatilities and spot drifts across a fixed curve. The regime breaks when the market starts trending or genuinely reprices risk.

How is sticky strike different from sticky delta?

They are opposite bookkeeping. Sticky strike holds the curve fixed to strikes, so at-the-money volatility changes and each strike's volatility stays constant. Sticky delta slides the whole curve with spot, so at-the-money volatility stays constant and each strike's volatility changes. Which one holds decides whether a delta hedge is really a hedge.

Does sticky strike change my delta?

Yes, but in a subtle way. The dynamic delta correction Δ_adj = Δ_BS + ν·(∂σ/∂S) is zero under sticky strike for a fixed strike, so the correct hedge is the Black–Scholes delta at each strike's own volatility. The real error sticky strike corrects is pricing every strike off a single flat at-the-money volatility, not a dynamic effect.

What is the sticky-strike delta adjustment?

The general adjustment is Δ_adj = Δ_BS + ν·(∂σ/∂S). Under sticky strike, a fixed strike keeps its volatility as spot moves, so ∂σ/∂S is zero and the adjustment vanishes — provided the Black–Scholes delta is computed at that strike's own implied volatility rather than a flat at-the-money number. The regime's real point is that the alternatives are not zero.

If the correction is zero, why does the regime matter?

Because the alternative regimes assign non-zero, opposite-signed values to ∂σ/∂S. Sticky delta makes the correction positive; sticky local volatility makes it negative; sticky strike sits at zero in the middle. Assuming the wrong regime corrects your delta in the wrong direction, which is worse than applying no correction at all.

Is sticky strike realistic?

It is a good leading-order description of a calm, range-bound market, but it is an idealisation — real markets never hold a curve perfectly fixed, and the actual smile deviates from the sticky-strike prediction every day. It fails outright when the market trends or reprices risk, when the whole curve gets redrawn rather than merely traversed.

What does sticky strike say about the leverage effect?

It is consistent with it. Under sticky strike, at-the-money volatility falls as spot rises and rises as spot falls, which is the negative spot-volatility relationship the leverage effect describes. So sticky strike builds in the empirically correct sign for equity indices without any additional assumption, which is part of why it works in quiet markets.

Can I tell which regime the market is in?

Not directly, but you can infer it from behaviour. Watch whether at-the-money volatility falls as spot rises (sticky strike), stays put (sticky delta), or falls faster than the fixed curve implies (sticky local volatility). Desks treat the regime as a hypothesis they continuously test against the market's own movement, because it is not observable in a single snapshot.

What happens to a fixed strike's volatility under sticky strike?

It stays constant. The 24,000 strike prints 12.8% whether spot is at 24,000 or 24,600 — its volatility is a property of the number 24,000, not of how far it is from spot today. This is the literal meaning of the name: volatility is sticky to the strike.

Why is it dangerous to keep assuming sticky strike?

Because the regime ends without warning, usually in a trend or a shock, and its comforting zero delta-correction then becomes wrong. A book still assuming sticky strike after the regime has ended is mis-hedged in a direction it cannot see, and the correction it is ignoring is exactly the one that has become large.

Does a falling at-the-money volatility under sticky strike mean the market is calming?

No. Under sticky strike a falling at-the-money print is an artefact of spot sliding down a stationary curve, not a repricing — nothing about the market's view of risk changed. Reading it as the market calming down mistakes a mechanical consequence of the regime for genuine information.

Should I use the at-the-money volatility to price my option under sticky strike?

Only if your option is at the money. Under sticky strike each option carries its own strike's volatility, so a 24,000 call keeps 12.8% even after spot rises and the at-the-money number drops to 11.4%. Using the at-the-money volatility for a non-at-the-money option misprices it and mis-sizes its hedge.

What is the minimum-variance delta?

The minimum-variance delta is the hedge ratio that minimises the variance of a hedged position when implied volatility moves with spot: Δ_adj = Δ_BS + ν·(∂σ/∂S). A volatility regime is an assumption about the ∂σ/∂S term, and sticky strike sets it to zero for a fixed strike, making the Black–Scholes delta at own volatility the answer.

How does sticky strike affect the skew's shape over time?

It does not change the shape at all as spot moves — that is the defining feature. The curve stays fixed to strikes, so its shape is preserved and only the location of the at-the-money point on it changes. The skew can still be re-marked to a new shape by fresh information, but not by spot movement alone.

Is sticky strike better or worse than sticky delta for hedging?

Neither is universally better; each is correct in a different market regime. Sticky strike fits calm, range-bound conditions and sticky delta fits trending ones. Using the assumption that matches the current regime is what matters, and using the wrong one applies a delta correction of the wrong sign.

Does sticky strike tell me anything about the level of volatility?

No. It describes only how the curve moves as spot moves, not whether the whole surface is about to lift or collapse. The overall level of implied volatility can rise or fall for reasons — events, shocks, changing risk appetite — that sticky strike says nothing about.

Why do desks use sticky strike as a reference even when it is not exactly true?

Because it is the clean zero point between the other regimes, so measuring how far the market's actual behaviour departs from sticky strike tells a desk which direction and how large a delta correction it really needs. It is a hypothesis to test against, not just an assumption to adopt.

What is the single most important thing to remember about sticky strike?

That its zero delta-correction is conditional on a calm, range-bound market and disappears the moment the market trends or reprices risk. Treating the zero correction as permanent, or reading a falling at-the-money print as the market calming, are the two errors that turn a convenient assumption into a hidden loss.

Voice search & related questions

Natural-language questions people ask about sticky strike.

What does sticky strike mean?

It means implied volatility stays attached to each strike as spot moves. The skew curve is glued to the strike axis and does not shift when the underlying moves, so the market just slides along a fixed curve. When spot rises along a downward skew, the at-the-money volatility falls because a higher strike is now at the money.

Why would at-the-money volatility drop just because the index went up?

Because under sticky strike the curve does not move — it slopes downward and stays fixed to strikes, so when spot rises the at-the-money point becomes a higher strike sitting lower on that curve. The drop is mechanical, not a repricing. Nothing about the market's view changed; the label "at the money" just moved to a cheaper strike.

Is my Black–Scholes delta right under sticky strike?

Yes, if you compute it with each strike's own implied volatility rather than one flat at-the-money number. Under sticky strike the dynamic correction term is zero, so the Black–Scholes delta at own volatility is the hedge. The common error is using a single at-the-money volatility for every strike, which misprices the delta wherever the skew is steep.

When should I assume sticky strike?

In calm, range-bound markets where the view of risk is settled and small spot moves do not redraw the curve. It is the quiet-weather regime. Avoid assuming it in a strong trend or a shock, when the whole curve gets redrawn and the dynamics look more like sticky delta or something more violent.

What goes wrong if I assume sticky strike in a trending market?

Your zero delta-correction becomes wrong. In a trend the market behaves more like sticky delta or sticky local volatility, where the correction is real and non-zero, so a book still assuming sticky strike is mis-hedged in a direction it cannot see. The regime ended, but your hedge did not notice.

How is sticky strike different from just having a skew?

A skew is the shape of the curve at one instant; sticky strike is a claim about how that curve moves when spot moves. Any downward skew is compatible with sticky strike — the regime adds the extra assertion that the curve stays fixed to strikes rather than sliding with spot. Shape and dynamics are two separate things.

Does sticky strike mean the market is bearish when volatility falls?

No. A falling at-the-money volatility under sticky strike is just spot sliding down a fixed curve as the index rises — if anything it accompanies a rising market. It carries no directional forecast. Reading the volatility drop as a bearish or bullish signal mistakes a mechanical feature of the regime for genuine information.

Sources & references

Last reviewed 10 July 2026. Educational content only — not investment advice.