Historical Volatility

The Hindu Business Line  6 hrs ago  Comment 
In times of downtrend, allocation to equity will be cut down under this to minimise loss
Yahoo  7 hrs ago  Comment 
Donald Trump speaks during a campaign rally at Crown Arena in Fayetteville, N.C. in August. Billionaire Tony Ressler, the co-founder and CEO of Ares Management (ARES), a publicly traded asset management firm with $100 billion in assets, says...
Benzinga  9 hrs ago  Comment 
USD/CAD is trading at 1.3255, up 0.0042. The pair is trading at session highs. Market chatter about money flows and comments from global various policy makers is making the rounds. Talk about volatility in energy prices is starting to...
Reuters  Sep 28  Comment 
Japan is accelerating its search for ways to improve some of its most important macroeconomic indicators to address long-standing concerns that some data are inaccurate or too volatile.
MarketWatch  Sep 28  Comment 
Business development companies can be volatile, but the yields may be worth it if you can hold on for many years, says Phil van Doorn
Benzinga  Sep 27  Comment 
European bank shares are witnessing volatile trading in the American stock exchanges following a comment from Credit Suisse Group AG (ADR) (NYSE: CS) CEO, Tidjane Thiam, about a challenging third quarter. According to a Dow Jones report, Thiam...
The Economic Times  Sep 27  Comment 
Domestic equity indices are likely to open on a flat note. Volatility may rise ahead of Thursday's expiry of September series futures.
guardian.co.uk  Sep 26  Comment 
Shares are down, volatility is up, and the Mexican peso is under pressure ahead of presidential debate between Hillary Clinton and Donald Trump (at 9pm New York/2am BST) Latest: Dow Jones closes down 166 points Volatility jumps as investors...


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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