Volatility Ratio

AAA

DEFINITION of 'Volatility Ratio'

A technical indicator used to identify price ranges and breakouts. The volatility ratio uses a true price range to determine a stock's true trading range and is able to identify situations where the price has moved out of this true range.

INVESTOPEDIA EXPLAINS 'Volatility Ratio'

The volatility ratio is typically signified with a primary line on a chart, apart from price bars. Although there is no hard-and-fast number used to determine when a breakout is probable, a volatility of 0.5 is most often used by technical traders.

RELATED TERMS
  1. Accounting Ratio

    A way of expressing the relationship between one accounting result ...
  2. Entropy

    A mathematical measurement of the degree of uncertainty of a ...
  3. Wide-Ranging Days

    A description of the price range of a stock on a particularly ...
  4. Trendline

    A line that is drawn over pivot highs or under pivot lows to ...
  5. Pattern

    In technical analysis, the distinctive formation created by the ...
  6. Breakout Trader

    A type of trader who uses technical analysis to find potential ...
Related Articles
  1. Simple Moving Averages Make Trends Stand ...
    Active Trading Fundamentals

    Simple Moving Averages Make Trends Stand ...

  2. Support And Resistance Basics
    Active Trading Fundamentals

    Support And Resistance Basics

  3. Momentum Indicates Stock Price Strength
    Trading Strategies

    Momentum Indicates Stock Price Strength

  4. Find Turning Points With Single-Day ...
    Trading Strategies

    Find Turning Points With Single-Day ...

comments powered by Disqus
Hot Definitions
  1. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  2. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  3. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  4. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  5. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
  6. Over The Counter

    A security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, etc. The phrase "over-the-counter" ...
Trading Center