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Volatility Smile

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Dictionary Says

Definition of 'Volatility Smile'

A common graphical shape that results from plotting the strike price and implied volatility of a group of options with the same expiration date.

Volatility Smile
Investopedia Says

Investopedia explains 'Volatility Smile'

A volatility smile is used by investors to price options in the foreign currency market and the equity option market.

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