Implied Volatility (IV)

May 25, 2021

Implied volatility is a metric that captures the market’s view of the likelihood of changes in a given security’s price. Investors can use it to project future moves and supply and demand, and often employ it to price options contracts.

Implied volatility is not the same as historical volatility, also known as realized volatility or statistical volatility. The historical volatility figure will measure past market changes and their actual results.