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Implied volatility

• The expected volatility in a stock's return derived from its option price, maturity date, exercise price, and risk less rate of return, using an option-pricing model such as Black/Scholes.

• Is the current volatility or the level of volatility required to generate an option premium given a known market price for the underlying, an interest rate, an expiration date and a strike price.

 
 Embedded terms in definition
 Exercise price
Exercise
Expected volatility
Expiration date
Expiration
Interest rate
Interest
Its
Market
Maturity date
Maturity
Option premium
Option price
Option
Premium
Rate of return
Return
Risk
Strike price
Underlying
Volatility
 
 Related Terms
 Expected volatility
Historic volatility
Implied call
Implied growth
Implied price
Implied price of a warrant
Implied repo rate
Implied return
Reward to volatility ratio
Term structure of interest rates and volatility
Volatility
Volatility risk
Volatility trades

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