Historical Volatility

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Benzinga  10 hrs ago  Comment 
Investors are hearing plenty this year about the boffo performances turned in by low volatility exchange-traded funds. They are also hearing quite a bit about the resurgence of emerging markets stocks and ETFs. Marry those two themes and the...
Reuters  11 hrs ago  Comment 
Billionaire hedge fund manager Dan Loeb believes that recent market volatility still offers "excellent opportunities" to make money despite a "catastrophic" period for...
Benzinga  11 hrs ago  Comment 
Twitter Inc (NYSE: TWTR) shares are trading lower by $2.58 (14.6 percent) at $15.17 in Wednesday's session. Although the company had EPS beat of a nickel, revenues came in light and the company guided revenues much lower for Q2. It has traded...
Yahoo  Apr 27  Comment 
Europe's big oil producers had been expected to report their worst quarterly earnings in the current downturn but instead BP, Total and Statoil have delivered share-boosting first-quarter results. The British oil major does not disclose figures...
Financial Times  Apr 27  Comment 
Biggest investors pulled more than £750m from asset manager during first three months of 2016
Motley Fool  Apr 27  Comment 
Marc Andreessen and Peter Thiel are two of the most successful tech investors around. Tune in to learn their secrets.
Clusterstock  Apr 26  Comment 
WASHINGTON (Reuters) - The top U.S. banking regulator on Tuesday released its proposal for establishing a Net Stable Funding Ratio, a final piece in the puzzle to strengthen banks' liquidity and discourage market-disrupting volatility. The ratio...
Financial Times  Apr 26  Comment 
GPIF chief Norihiro Takahashi says any hedging would only be aimed at smoothing volatility
newratings.com  Apr 26  Comment 
WASHINGTON (dpa-AFX) - Thomson Reuters (TRI, TRI.TO) said that it re-affirmed its full-year business outlook for 2016 which was previously communicated in February 2016. "The year is off to a solid start. today's results are in line with...




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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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