Volatility Forecasting Based on a Self-learning Algorithm: Returns up to 24.28% in 3 Days

Volatility Forecasting

Volatility Forecasting: This Volatility forecast is designed for investors and analysts who need predictions of the implied volatility for a basket of put and call options related to a specific index. It includes 8 volatility indices with bullish and bearish signals and indicates the best Volatility Index to trade:

  • Volatility indices for the long position
  • Volatility indices for the short position

Volatility Forecast
Package Name: Volatility Forecast
Recommended Positions: Long
Forecast Length: 3 Days (1/16/22 – 1/19/22)
I Know First Average: 10.51%
Volatility Forecasting
Volatility Forecasting chart

For this 3 Days forecast the algorithm had successfully predicted 6 out of 7 movements. ^VIX was the highest-earning trade with a return of 24.28% in 3 Days. Other notable stocks were ^VXD and ^JNIV with a return of 21.84% and 13.56%. The package had an overall average return of 10.51%, providing investors with a 13.30% premium over the S&P 500’s return of -2.79% during the period.

The Volatility Index, or VIX, is an index created by the Chicago Board Options Exchange (CBOE), which shows the market’s expectation of 30-day volatility. It is constructed using the implied volatilities on S&P 500 index options. This volatility is meant to be forward looking, is calculated from both calls and puts, and is a widely used measure of market risk.

Algorithmic traders utilize these daily forecasts by the I Know First market prediction system as a tool to enhance portfolio performance, verify their own analysis and act on market opportunities faster. This forecast was sent to current I Know First subscribers.

How to interpret this diagram

Algorithmic Stock Forecast: The table on the left is a stock forecast produced by I Know First’s algorithm. Each day, subscribers receive forecasts for six different time horizons. Note that the top 7 stocks in the 1-month forecast may be different than those in the 1-year forecast. In the included table, only the relevant stocks have been included. The boxes are arranged according to their respective signal and predictability values (see below for detailed definitions). A green box represents a positive forecast, suggesting a long position, while a red represents a negative forecast, suggesting a short position.

Please note-for trading decisions use the most recent forecast. Get today’s forecast and Top stock picks.