How do you identify a volatile stock market?
Asked 4 years ago
Which indicator is used for volatility in the market?
Andrew Moran
Wednesday, November 17, 2021
The volatility of a stock market is when the price of a benchmark index, stock, or other type of investment security rises or falls in a specific period.
If volatility is high, the risk is greater - and vice versa.
So, what indicators do you utilize to determine stock market volatility?
Here is a brief list:
Cboe Volatility Index (VIX): This is a gauge of market volatility (anything above 30 indicates increased volatility).
Bollinger Bands: Two typical deviations above and below the 20-day moving average (a line between the two bands).
Average True Range (ATR): The highest value generated by one of three equations: the session's high subtract the current day's low, day's high minus the previous day's close, and the previous session's close minus the current day's low.
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