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Kelvin,
I assume option volatility in Metastock is base on EOD although Pro version
has both EOD and RT. However I am not sure if you download intraday data,
will the option volatility be computed based on the intraday. I couldn't
access the formula of it, otherwise we can examine to see what it does. By
an chance, do you have its formula ?
Do you have information on Don Fishback, it seems that you know quite a
bit. I could modify the period and percentage in Don's indicator to show
different coverage on chart. But I really need to understand how to apply
it for option analysis - need application notes. I can do paper trade to
evaluate it's truth.
I viewed OptionsXpress site, you must open an account in order to access
the charting of "Historical IV". Could you demo and capture a screen of it
and post it to me. Btw, are you a member there ?
Best Regards
Freddie Ng
At 06:20 PM 4/9/2003 +0100, you wrote:
>I have noticed a few posts recently suggesting that the Metastock Option
>Volatility indicator plots implied volatility. I suggest a little caution
>here. There is not sufficient data in stock end-of-day prices to calculate
>the implied volatility of the options on that stock. In order to do that,
>you would require the option prices for the complete chain. Also, bear in
>mind that options for different strike prices may well have different
>implied volatilities. Sometimes the difference is quite marked.
>
>The Option Volatility indicator can only be based upon some kind of
>historical volatility formula. Therefore, if you are comparing this to,
>say, the Fishback historical volatility indicator, which is based upon a
>linear regression calculation, you are comparing like to like and it will
>be of no use to you for options trading.
>
>In order to see 'historical' implied volatility, you will need to access a
>website that has all of that data stored. I think that OptionsXpress will
>let you chart 'historical' IV on particular stocks for free.
>
>Regards,
>Kevin
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