Volatility Skew
The lopsided way the market prices implied volatility higher on one side of the strike range.
Definition
Volatility skew is the tilt in implied volatility as you move across strikes of the same expiry. Where a volatility smile is roughly symmetric, a skew is one-sided: in equity indices the downside (lower-strike) puts typically carry noticeably higher IV than the upside calls, producing a downward-sloping curve sometimes called a smirk.
Why it matters
Skew tells you where the market sees the bigger risk. A steep put skew means crash insurance is in heavy demand and downside protection is expensive. Traders read changes in skew as a sentiment gauge, and the shape directly affects the relative value of spreads, the cost of hedges, and how Greeks behave on each wing.
Example
With an index near 20,000, the 18,500 put might quote around 18% implied volatility while the 21,500 call quotes near 12%. That gap, with the low strikes richer, is the equity index skew. If the put IV climbs further versus the call, the skew has steepened, often a sign of rising downside fear.
See it live
Track how implied volatility tilts across strikes in real time on TradePulse's live option chain.