Portfolio Analytics

Implied Volatility

Definition

What is Implied Volatility?

The future volatility level implied by an option's market price.

Example in practice

Option prices rise when traders expect larger future market moves.

Keep learning

A statistic ranging from minus one to plus one that describes how two return series move together.

A relationship in which two assets tend to move in the same direction.

A relationship in which two assets tend to move in opposite directions.

An analysis of portfolio performance under severe but plausible scenarios.

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