Contraction Normalized IV Rank Exit
Setting key
contraction_iv_normalized_rank
Default
30
What it does
IV Rank threshold at which the bot considers the vol contraction complete and closes the position. When IVR falls back to 30, the edge (selling into elevated vol) has been harvested. The position is closed regardless of DTE. This exit only fires when the short strikes are not tested; if a short is tested, the roll ladder takes over instead.
When to change it
Raise to 40 to harvest more of the contraction before exiting. Lower to 20 to exit earlier and lock in less gain but with higher certainty.
Safe range
20 (early exit) to 45 (full contraction).
Example
Contraction trade entered when IVR = 83. Five days later IVR has fallen to 28. With iv_normalized_rank=30, the bot closes the position at the next cycle (IVR below threshold, shorts untested).