IV Rank at Historic Lows: Options Are Cheap Across the Board

The Volatility Landscape: February 19, 2026

A quiet stretch in markets has driven implied volatility to some of the lowest levels we have seen in the past year. Across the mega-cap tech complex and major indices, IV Rank readings are signaling that options are priced cheaply relative to their 52-week historical range. For options traders, this creates a distinct set of opportunities and risks worth examining.

Current IV Rank Snapshot

Here is where implied volatility stands today across key names, ranked by IV Rank from lowest to highest:

• TSLA — IV Rank: 9.7% | Current IV: 42.8% | State: VERY LOW
• SPY — IV Rank: 16.3% | Current IV: 15.9% | State: VERY LOW
• AAPL — IV Rank: 18.9% | Current IV: 25.5% | State: VERY LOW
• META — IV Rank: 20.9% | Current IV: 32.4% | State: LOW
• QQQ — IV Rank: 21.3% | Current IV: 21.1% | State: LOW
• NVDA — IV Rank: 28.2% | Current IV: 40.8% | State: LOW
• AMD — IV Rank: 45.4% | Current IV: 54.9% | State: NORMAL
• COIN — IV Rank: 45.9% | Current IV: 68.6% | State: NORMAL

The standout here is Tesla. At an IV Rank of just 9.7%, TSLA options are near their cheapest level in the past 12 months. For a stock that routinely carries 50-80% IV, the current 42.8% reading represents a meaningful discount on premium.

What Low IV Rank Means for Your Strategy

IV Rank measures where current implied volatility sits relative to its 52-week range. A reading below 25% tells us that options are priced in the lower quartile of their historical range. This has direct implications for strategy selection:

Premium Buyers Have the Edge

When IV Rank is low, you are buying options at a relative discount. Strategies that benefit from rising volatility or directional moves become more attractive:

• Long straddles and strangles — Cheaper entry means better risk/reward if volatility expands
• Debit spreads — Lower cost basis on directional plays
• LEAPS calls — Long-term bullish exposure at reduced premium
• Calendar spreads — Buy cheap back-month options against near-term premium

Premium Sellers Face Thinner Margins

Conversely, low IV environments compress the premium available to sellers. Iron condors, credit spreads, and covered calls will generate less income than usual. Sellers should consider:

• Reducing position size to account for lower premium collected
• Widening strikes to maintain a meaningful credit
• Waiting for IV expansion before initiating new short premium trades
• Focusing on names where IV is still elevated — AMD (45.4%) and COIN (45.9%) still offer reasonable premium

Tesla: The Most Interesting Setup

TSLA at a 9.7% IV Rank deserves special attention. The stock is trading around .50, with the market pricing an expected move of just .78 (2.6%) through tomorrow. For a stock that has historically delivered 5-15% earnings moves and can swing 8% on a tweet, this level of complacency is notable.

Traders looking to position for a potential volatility expansion in TSLA may find long straddles or strangles attractive at these levels. The key question is timing — low IV can persist for weeks before a catalyst arrives.

Where IV Is NOT Low

Not everything is cheap. AMD at 45.4% and Coinbase at 45.9% IV Rank are closer to fair value. COIN in particular, at 68.6% absolute IV, still offers substantial premium for defined-risk selling strategies. If you are a premium seller looking for opportunities in this environment, these names warrant a closer look.

What Could Change This

Low volatility regimes do not last forever. Common catalysts for IV expansion include:

• Earnings season — Individual stock IV will spike as reports approach
• FOMC meetings — Rate decisions create market-wide IV events
• Geopolitical developments — Unexpected events cause rapid IV expansion
• Economic data surprises — CPI, jobs, and GDP misses can reprice volatility

The current low-IV environment creates a favorable setup for buying volatility ahead of known catalysts. Consider positioning in advance of these events when premium is still cheap.

Key Takeaways

• IV Rank is below 25% on SPY, QQQ, AAPL, META, and TSLA — options are cheap
• TSLA at 9.7% IV Rank is the most extreme reading, near its 52-week floor
• Premium buyers should consider debit spreads, LEAPS, and long volatility strategies
• Premium sellers should focus on AMD and COIN where IV is still at normal levels
• Watch for upcoming catalysts (earnings, FOMC) that could trigger volatility expansion

This analysis is for educational purposes only and does not constitute financial advice. Options involve risk and are not suitable for all investors. Always do your own research before trading.