Historical Volatility

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SeekingAlpha  10 hrs ago  Comment 
By Bart Gruzalski: Contrarianism has a tremendous appeal to many investors and for good reason. The crowd is sometimes right but is wrong often enough that there is serious profit to be made betting against the crowd. What would a contrarian do...
Gold Stocks Today  11 hrs ago  Comment 
When it comes to the stock market, October gets a bad rap. It's true, there have been some major crashes in October (ahem... Black Monday, Black Tuesday, etc.) but on a shorter timeline this month hasn't been nearly as bad as you might think....
SeekingAlpha  Sep 30  Comment 
By Value Plus Incentives: Traditional Fixed Income Portfolios can no longer provide acceptable IRRs with low price volatility. Family offices and individual private investors need to be asking hard questions when reviewing their...
Mondo Visione  Sep 30  Comment 
NASDAQ OMX today announced that Compass EMP will list a new exchange traded fund, Compass EMP Developed 500 Enhanced Volatility Weighted Index ETF (Symbol: CIZ), on The NASDAQ Stock Market® (NASDAQ®). CIZ will begin trading on NASDAQ Wednesday,...
The Times of India  Sep 30  Comment 
The BSE benchmark sensex on Tuesday surrendered most of its early gains and closed a moderate 33 points higher on selling in interest-sensitive stocks of banking and realty stocks, after the RBI kept interest rates unchanged in its bi-monthly...
MarketWatch  Sep 30  Comment 
It may still be pushing mid-80s here in southern California, but the dog days of summer, as far as the market is concerned, are long gone. Last week’s ominous burst of volatility made sure of that.
Yahoo  Sep 30  Comment 
Odds are the stock market will have a pretty good fourth quarter after it begins on Wednesday, but it's almost certain to be a volatile one.
SeekingAlpha  Sep 30  Comment 
By Jeff Malec: While hardly scientific, we tend to have a knack for highlighting a certain market move or environment on the blog, and that market or environment quickly reversing course upon our piece hitting the airwaves. It's the futures market...
SeekingAlpha  Sep 30  Comment 
By Greenspud Trades: This past year I have been working on trading strategies involving the VXX and XIV securities. These are exchange traded notes (ETNs) intended to mimic the short-term moves in the CBOE volatility index (VIX). The VIX is not a...
The Hindu Business Line  Sep 30  Comment 
Sensex closed flat with a gain of 33 points after roller-coaster rider influenced by the RBI credit policy. The benchmark Sensex opened on the higher side at 26,611 against the previous c...




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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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