Volatility Instruments
Volatility instruments are financial instruments that track the value of implied volatility of other derivative securities. For instance, the CBOE Volatility Index (VIX) is calculated from a weighted average of implied volatilities of various options on the S&P 500 Index. There are also other commonly referenced volatility indices such as the VXN index (Nasdaq 100 index futures volatility measure), the QQV (QQQ volatility measure), IVX - Implied Volatility Index (an expected stock volatility over a future period for any of US securities and exchange traded instruments), as well as options and futures derivatives based directly on these volatility indices themselves.
Read more about this topic: Implied Volatility
Famous quotes containing the word instruments:
“Whilst Marx turned the Hegelian dialectic outwards, making it an instrument with which he could interpret the facts of history and so arrive at an objective science which insists on the translation of theory into action, Kierkegaard, on the other hand, turned the same instruments inwards, for the examination of his own soul or psychology, arriving at a subjective philosophy which involved him in the deepest pessimism and despair of action.”
—Sir Herbert Read (1893–1968)