An IV crush calculator estimates the premium hit when implied volatility falls after an earnings report. A simple educational model: scale the option’s price by the ratio of post-earnings IV to pre-earnings IV (vega-style approximation). Example: IV 80% → 45% on a $5.00 option ≈ premium toward $2.81 (−44%) if nothing else changes. Real prices also move with the stock, time, and spreads — this is a teaching tool, not a pricer.
Estimate the crush
Illustrative inputs only. Not platform data. Not a Black–Scholes engine.
How to read the estimate
- Useful for: building intuition about how large an IV drop can be.
- Not useful for: exact P&L — stock move, skew, and theta matter too.
- Pair with: the expected move calculator (size priced in) and IV crush after earnings.
Common mistakes
- Assuming the stock “going up” saves a long call from crush.
- Using far-dated IV that barely includes the event.
- Treating one famous quarter (e.g. NVDA May 2023) as the base case — case study.
How EarningsWatcher helps
Once the idea clicks, research real names with Calendar, Moves, and IV tools — live implied moves and historical context, not a spreadsheet. Soft next step: join EarningsWatcher.
Frequently asked questions
What does an IV crush calculator estimate?
How much an option’s premium can shrink when IV falls after earnings, holding other inputs fixed. Enter pre-IV, post-IV, and premium. Rough educational estimate — not a pricing engine.
Is this EarningsWatcher’s live IV crush tool?
No. This page uses numbers you type in. Live IV rush/crush research is on the platform when you join.
Why do options lose value after earnings even if the stock moves my way?
Because implied volatility often collapses once results are public. If the stock move does not clear what options priced in, that crush can outweigh a modest directional move.
Education only. Not investment advice. No proprietary platform data on this page. Options involve risk.