Volatility Cone
Historical volatility distribution across time horizons
What is Volatility Cone?
Volatility Cone A visualization showing the historical distribution of realized volatility at different time horizons. By plotting percentiles (minimum, 25th, median, 75th, maximum) of past realized volatility for each tenor, traders can compare current implied volatility to its historical context and identify whether options are cheap or expensive.
Complete Definition
A visualization showing the historical distribution of realized volatility at different time horizons. By plotting percentiles (minimum, 25th, median, 75th, maximum) of past realized volatility for each tenor, traders can compare current implied volatility to its historical context and identify whether options are cheap or expensive.
Related Terms
Want to Learn More?
Explore our educational resources and analytics tools to deepen your understanding.