Historical Volatility

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Wall Street Journal  53 min ago  Comment 
Macquarie Group said its annual profit jumped a better-than-expected 27% as it benefited from global market volatility and a weaker currency.
Daily FX  1 hr ago  Comment 
A shot of volatility seems to be what is needed for an indecisive Dollar. Can Friday's NFPs provide it? Having pulled back from more than a nine-month run to a decade high this past month, the Dow Jones FXCM Dollar Index
Benzinga  9 hrs ago  Comment 
In a report published Thursday, analysts at Morgan Stanley maintained an Overweight rating on Whole Foods Market, Inc. (NASDAQ: WFM). The price target was lowered from $62 to $56. The company posted lower than expected comps for 2Q. The 2Q comps...
TheStreet.com  10 hrs ago  Comment 
NEW YORK (TheStreet) -- Volatility spiked early this year as investors worried about a potential rate hike. That volatility has been decreasing because, among other reasons, the Federal Reserve is trying to keep investors -- and the market --...
Financial Times  May 7  Comment 
Dollar rebounds and equities rise
Benzinga  May 6  Comment 
With luxury electric car maker Tesla Motors Inc (NASDAQ: TSLA) set to release earnings after the closing bell Wednesday, now is a good time to look back at how Tesla's stock has reacted to earnings since the company went public back in...
guardian.co.uk  May 6  Comment 
Company results support market but investors remain cautious on Greece and UK election In a volatile day’s trading, leading shares ended marginally higher, helped by a raft of well received company results but unsettled by a warning on...
Wall Street Journal  May 6  Comment 
Oil prices spiked in a volatile session Wednesday as weekly data showed U.S. stockpiles fell for the first time this year, but the market gave back much of its gains amid a continued bearish backdrop.
Benzinga  May 6  Comment 
Joel Elconin is the co-host of Benzinga's #PreMarket Prep, a daily trading idea radio show. S&P 500 index futures were trading lower by nine points at 2075 in Wednesday's session. The index followed through in its pre-market and after-hours...




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Volatility refers to the tendency of prices to change unexpectedly, usually as a response to new information or changes in demand for the investment. Volatility can be defined as an investment's tendency to move up and down in price over the latest n periods.

A security with high volatility has bigger fluctuations in price compared to a security with low volatility. The more quickly a price changes up and down, the more volatile it is. As such, volatility is often used as a measure of risk.

For example: A stock whose price went up 10% yesterday and went down 25% today is more volatile than a stock which increased 2% in both days.

Historical volatility is calculated by looking at past changes in stock price. The standard deviation of percentage changes in price is used to calculate observed volatility within the considered timeframe.

Historical Volatility, which looks at the past, is distinct from Implied volatility, which represents expectations about future fluctuations in price and is calculated by looking at the prices of options on the underlying investment.

Volatility is also different from Beta, which is a measure of how the stock price reacts to changes in a broad market index, such as the S&P 500.


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