What is IMPLIED Stock Volatility?

By Staff Reporters

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Implied open attempts to predict the prices at which various stock indexes will open at 9:30 am EST. It is frequently shown on various cable television channels and websites prior to the start of the next business day.  This is a powerful tool that gives traders an indication on whether they should be bullish or bearish during the market for SPX, NDX, and RUT.

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What is Implied Volatility?

Implied volatility shows how much movement the market is expecting in the future.

Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off.

MORE: https://medicalexecutivepost.com/2022/03/18/options-and-derivatives-glossary/

However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.

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RELATED: https://www.amazon.com/Comprehensive-Financial-Planning-Strategies-Advisors/dp/1482240289/ref=sr_1_1?ie=UTF8&qid=1418580820&sr=8-1&keywords=david+marcinko

VIX: https://medicalexecutivepost.com/2022/09/01/what-up-vix/

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