Implied volatility isn't something you observe directly the way you'd check a stock's price — it's something you work backward to. Plug an option's actual market price into a pricing model (like Black-Scholes), and solve for whatever volatility assumption would have produced that exact price: that number is the implied volatility. It represents the market's forward-looking expectation of how much the underlying is…
You have read your 2 free lessons. Making an account is free and gives you 2 more straight away — plus your progress, streak and quiz scores saved as you go.
Learning through your school? Join your class — school students get everything, at no personal cost.