Named after Steven Heston, the Heston model is a mathematical model describing the evolution of the volatility of an underlying asset. It is a stochastic volatility model: such a model assumes that the volatility of the asset is not constant, nor even deterministic, but follows a random process. The Heston Model is one of the most widely used stochastic volatility (SV) … [Read more...]
Stock Volatility in stock market
The relative rate at which the price of a security moves up and down. Volatility is found by calculating the annualized standard deviation of daily change in price. If the price of a stock moves up and down rapidly over short time periods, it has high volatility. If the price almost never changes, it has low volatility. n other words, volatility refers to the amount of … [Read more...]