Volatility
From MarketsWiki
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Volatility is the relative rate at which the price of a security or contract moves up and down. Volatility is found by calculating the annualized standard deviation of daily change in price.[1][2][3]
A volatile market, contract or security is one whose price tends to fluctuate sharply and regularly.
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Technical Analysis
Volatility can be used in various manners to measure market activity. Traders use volatility indicators to make decisions about changes in market direction.[4]
VIX
The VIX is a volatility index developed by the Chicago Board Options Exchange in 1993 to measure investor sentiment and market volatility. It is often referred to as a "fear guage."
The CBOE has introduced futures and options on the VIX.
Resources
References
- ↑ Glossary. U.S. Commodity Futures Trading Commission.
- ↑ Glossary. CME.
- ↑ Market volatility explained. Fortune.
- ↑ Volatility. Online Trading Concepts.
