Historical Volatility

Historical volatility (HV) describes the past price movement of an underlying security. Historical volatility is also known as statistical volatility because it quantifies the security’s actual volatility over a defined timeframe. 

Historical volatility calculates a backward-looking moving average of a security’s realized volatility. HV is essentially a snapshot of how much volatility a security experienced in a specific period and can be used to compare two different assets.

Historical Volatility does not quantify a security’s future expected move like implied volatility, but it can be used as a basis for what might happen based on what happened in the past.