Volatility Quotient (VQ%)

May 05, 2021

The Volatility Quotient (VQ/Risk) indicates how volatile an investment is based on at least one year’s historic price action. This ensures the user takes the right amount of risk in any trade based on TradeSmith algorithms. We utilize the VQ to determine the trailing stop for our Health Indicator and VQ trailing stops for positions tracked within TradeSmith. The lower the number, the more stable the movement of that stock. Higher percentages indicate the stock is more volatile in its market moves over time.