________ volatility are calculated by being backed out of the market option premium values traded.
A)Historic
B)Forward-looking
C)Implied
D)none of the above

Question

Quizplus · Accepted Answer

Implied volatility is calculated by determining the volatility level that would result in the current market prices of options. It is based on the prices of options traded in the market, and it reflects the market's expectations of future volatility. Historic volatility (A) is based on past price movements, while forward-looking volatility (B) is an estimate of future volatility based on financial models or forecasts.

________ Volatility Are Calculated by Being Backed Out of the Market