Historical Volatility

MarketWatch  51 min ago  Comment 
European stocks swing between gains and losses Thursday, hampered by lower volume and a flip lower in oil prices before a production decision from the Organization of the Petroleum Exporting Countries.
The Economic Times  6 hrs ago  Comment 
A key aspect of sortino ratio is it specifically focuses on downside volatility of a scheme.
Benzinga  May 24  Comment 
Chesapeake Capital’s Jerry Parker joined the investment world by no conventional means. “I read an advertisement in the Wall Street Journal that [Richard Dennis] was hiring people, teaching them how to trade and staking them with money,”...
Benzinga  May 24  Comment 
According to some analysts, retail stocks have been so hard hit as of late that investors who pick a strong standout in the group could be rewarded. One of those analysts is Susquehanna's Stacey Gilbert, who explained during a recent CNBC...
MarketWatch  May 24  Comment 
Ulta Beauty Inc. shares are down nearly 4% in Wednesday trading after the company was downgraded to hold from buy at Edward Jones. "At current levels, we believe the shares adequately reflect our outlook for above-average earnings growth,"...
The Hindu Business Line  May 24  Comment 
The sugar market seems to be under pressure as prices at all levels remained unchanged with thin volatility over the past week. On Tuesday, about 18 mills sold 38,000-40,000 bags at ₹3,725-3,760 (...
Benzinga  May 24  Comment 
The PowerShares S&P 500 Low Volatility Portfolio (NYSE: SPLV) turned six years old earlier this month and is home to over $6.6 billion in assets under management. In other words, SPLV is one of the oldest and largest low volatility exchange traded...
SeekingAlpha  May 24  Comment 
The Hindu Business Line  May 24  Comment 
PSU banks, metal, pharma stocks under pressure


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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