Volatility Skew & Term Structure

Implied volatility is not the same for every strike. On SPY and QQQ, out-of-the-money puts almost always have higher IV than equidistant calls.

This 'smirk' exists because crashes happen fast and gaps are usually down. The market permanently charges more for downside insurance.

Practical effect: selling OTM puts earns richer premium than selling OTM calls at the same distance — but it carries the crash risk the premium is paying for.