How to calculate stock volatility in %?

How can I calculate the stock volatility in percentage?
Do i have to use sd() function without any other calculation ?

Thanks

Answer

You’re looking for the standard deviation of log returns, appropriately annualized and converted to percentage (i.e. multiplied by 100).

Here is an example of computing annual vol from daily prices:

library(tseries)
data <- get.hist.quote('VOD.L')
price <- data$Close
ret <- log(lag(price)) - log(price)
vol <- sd(ret) * sqrt(250) * 100

Notes:

  1. The above code should really be using prices adjusted for corporate actions (dividends, splits etc).
  2. 250 is the (approximate) number of trading days in a year.

Attribution
Source : Link , Question Author : ECOtime , Answer Author : NPE

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