Learn about the Black-Scholes model, how it works, and how its formula helps estimate fair option prices by weighing ...

Volatility influences options prices because dramatic price swings amplify gains and losses. While traders can’t look at a crystal ball to see how much volatility the market will endure, implied ...

Jeff Kohler has 20+ years of experience as a trader/analyst. He currently runs TradingAddicts.com, providing market insight and analysis to investors. Michael Boyle is an experienced financial ...

Implied volatility is arguably the most important factor for options trading. This week, we discuss how to interpret implied volatility. We also show why you should not use implied volatility as an ...

With the rise in volatility within markets, it is important to understand what implied volatility is and how it can be used as a tool when it comes to trading. According to the CFA institute, implied ...

The implied volatility is a crucial element in any financial toolbox, since it is used to both quote and hedge options as well as for model calibration. In contrast to the Black–Scholes formula, its ...

One of the most important risk factors when trading financial assets and their derivatives is the actual and historical volatility of the underlying asset that impacts the implied volatility used to ...

Implied volatility is a powerful but often misunderstood metric that plays a major role in options trading. Implied volatility doesn’t tell you what’s going to happen to an option’s price, but it ...