Learn · options market structure
What is VIX term structure (contango vs backwardation)?
VIX term structure compares expected volatility over different horizons. In contango, longer-dated volatility is priced above the 30-day VIX, the normal calm-market shape. In backwardation, near-term volatility is priced above longer-term, which usually happens during selloffs when traders pay up for immediate protection.
Why the shape matters
The same VIX level means different things depending on the curve. A VIX of 20 in contango is an elevated but orderly market; a VIX of 20 in backwardation says the stress is concentrated right now.
What to watch
The ratio of VIX to 3-month VIX (VIX3M) is a common summary: above 1 means backwardation. Moves in and out of backwardation often line up with the start and end of volatility spikes.
On GammaPulse
The Market tab shows VIX, its percentile over the past year and the implied one-day SPY move; the VIX options detail adds the strikes where VIX option open interest is concentrated.
Related
- What is the expected move and how is it calculated?
- How often does SPY stay within the VIX expected move?
- What is IV rank?
Education and market data, not investment advice. GammaPulse does not publish a track record or performance claims.