been wanting to learn how to use this graph. How do I use this graph to detect any inefficiencies in the market or the interpret the market expectation of the underlying?
You don’t unless you have a reason to believe the spot vol correlation implied by the graph is different from what the reality will be.
Seaborn, Matplotlib, etc. often produce a sort of a superstitious awe in people not used to seeing numbers plotted visually. But in the end, this is somewhat like looking at a number on the screen and asking "how do I use this to make money?” Being able to change numbers into a colored graphical show does not change the fundamental challenge of trading - which is figuring out where to "buy cheap and sell dear". Although it can help visualize things once you have an approach that produces alpha.
i never found a 3d volatility graph to be anything other than annoying. it's very gimmicky. like heatmaps.
there are better ways to quantify that. i can't even see it because the flap from the 5 delta puts is hiding it.
Different reciprocating action for different individuals, as the saying goes. Some love'em, and work with them all day long; I glance at them just to get a sense of what the overall structure looks like. Others just run an eye over the options chain and can see trades (a level of skill I aspire to.)
if you look at the term structure (back bone) and 1 or 2 skew plots you get the idea of the surface. you will know where to look closer. it's easy to see opportunities in the options chain if you have the ivols but those are basically impossible to execute. I'm working one now and it's unlikely a trade will happen as i'm $2 dollars away from a marketable order on a 50ish dollar stock.
I think this is only possible if you are into a few instruments and know the prices by heart. Otherwise indeed numbers (with filters) are better and faster instead of graphs imho. In the end focussing on what idea/strategy to trade is what its about, not thze rainybows charts. Unless one wants to impress cryptocrowdies (also build a good beat and show around it)
%% ME; i would Look @ lot more data than that\ + find better fundamentals. Lose you blues\ everybody cut loose/Foot Loose/K Loggins,> 70,777,888 video views. I skip penny stocks also\ but i dont want stocks worth pennies.