research
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Apr 6, 2026
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12 min read
Variance Risk Premium: The Complete Guide to the Edge in Options
What Is the Variance Risk Premium and Why Does It Matter?
October 10, 2025. SPY implied volatility sits at 22% while realized volatility has settled around 12%. That 10-point gap, the variance risk premium, means option buyers are paying for a level of future movement that the market has no
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