Implied Volatility Calculator
Back out the implied volatility that matches a market option premium.
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Why implied volatility matters
Implied volatility is the market's consensus estimate of future movement embedded in option prices. It does not predict direction; it reflects expected magnitude. Traders compare current IV versus historical IV or earnings-event IV to judge whether premium is rich or cheap.
This calculator uses an iterative Black-Scholes method, so it works best for liquid European-style approximations. American equity options can differ slightly because of early exercise features and dividends.
Educational only. IV is model-derived and can vary by strike, expiration, and market microstructure. Use with caution.