Historical Volatility

RECENT NEWS
The President Does Not Drop Out of Sight, but Does Get Out of Town
New York Times  5 hrs ago  Comment 
President Obama continued to keep abreast of developments in Ukraine and would most likely abandon his “recreational amenities,” should events become more volatile, a spokesman said.     
A Bellwether Says The Severe Winter Hurt Advisor Recruitment
Clusterstock  8 hrs ago  Comment 
FA Insights is a daily newsletter from Business Insider that delivers the top news and commentary for financial advisors. LPL Blames Recruitment Slowdown On Weather And Stock Market Volatility (Investment News) The severe cold that slammed...
​Expect markets to be volatile in short term: J Venkatesan, Fund Manager, Sundaram Mutual
The Economic Times  Mar 7  Comment 
"In FY14, we will have a GDP growth of something like 4.8% or so, but next year in FY15, we will come back strongly on growth."
China’s renminbi bounces back
Financial Times  Mar 7  Comment 
Chinese currency set for biggest weekly gain in more than two years after a big slide last week, as the PBoC moves to inject greater two-way volatility
3D Systems: 1-Year Price Target Of $86
SeekingAlpha  Mar 6  Comment 
ByIAEResearch: At the start of March, last year, I gave 3D Systems (DDD) a price target of $47 per share when the stock was trading close to $30 per share. However, the stock gained value faster than expected, and it more than tripled in value...
Why Govt policies should consider market microstructure issues
The Hindu Business Line  Mar 6  Comment 
All the components of trading rules affect microstructure variables such as liquidity, volatility
Seeing Through Emerging Market Volatility
SeekingAlpha  Mar 6  Comment 
By AllianceBernstein: By Sharon Fay Stock markets in emerging markets (EMs) have gotten off to a rough start this year after a challenging 2013. Valuations have fallen and volatility remains high. So should investors add exposure to emerging...
Natural Gas may see high volatility US inventory data awaited
Commodity Online  Mar 6  Comment 
USD: Currency Index & Volatility
FX Street  Mar 6  Comment 
Weak Economic Data Signal Low Inflation Ahead
SeekingAlpha  Mar 6  Comment 
ByNorthwest Trader: Current State of Inflation Presently, the rate of inflation is running at 0.76% on a non-seasonally adjusted SMSAR basis. According to our depth, breadth, volatility metrics, we are in a low state of inflation with moderate...
High volatility expected after ECB meeting
FX Street  Mar 6  Comment 
European Session Overview Today is going to be an interesting day, as high volatility is expected... For more information, read our latest forex news and reports.




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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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