*VARIANCE TERM STRUCTURE CAN INDENTIFY TRADES**To determine if a term structure trade is needed, we could look at variance term structure rather than implied volatility term structure...An ATM term structure will not be ATM as soon as the spot moves, so it is effectively strike dependent.*

*Variance term structure is similar to ATM term structure, despite variance being long skew and skew being greater for near-dated implieds. This is because the time value of an OTM option increases with maturity. Hence, the increased weight associated with OTM options cancels the effect of smaller skew for longer maturities.*