Trading term
What is SKEW index?
The SKEW index is a Cboe index that tracks how expensive far-out S&P 500 puts are compared with options near the price. A higher SKEW means crash protection costs more.
Options that pay off in a crash are priced from the same S&P 500 options as the VIX, but SKEW looks at their shape. When far-out puts get dearer relative to the rest, SKEW rises. Since 1990 it has nearly always been between about 105 and 160.
It isn't a crash forecast. It's a price: how much traders are paying to protect against a big fall.
For example
SKEW averaged about 116 in the 1990s and 2000s, 126 in the 2010s and 140 since 2020.
Go hands-on in Premium
That's SKEW index in theory — it clicks when you read it on a live chart. Practise it hands-on in the TradeWize Premium Options track.
Explore Premium →Why it matters to you
Any strategy that buys far-out puts for protection, like an iron condor's lower wing, pays more when SKEW is high. That eats into what the strategy collects.
⚠ Reading it as a crash signal
It tells you what protection costs, not when you'll need it. Don't treat a high reading on its own as a reason to sell.