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Varian Medical Systems, Inc. Historical Volatility

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Daily Volatility = Price Range as a percent of the daily average price. of Varian Medical Systems, Inc.

This chart shows Volatility for Varian Medical Systems, Inc., defined to be the price range as a portion of the average price:

So, to derive the Daily Volatility on 12/31/2010 of 0.9%, the price range for the day (0.68) was divided by the average price (69.62). The Daily Volatility is obtained by dividing the daily range by the daily average. A longer Volatility period such as Weekly Volatility is obtained by dividing the weekly price range by the weekly mean price. This is a different concept from the weekly average of daily volatility.

The red plot shows the actual price. The remaining marks on the plot correspond to the Volatility measured across several time intervals.

Investors often make a distinction between the concept of Volatility, and the concept of Risk. Academics define them to be exactly equivalent, but as can be seen here, there is good reason to distinguish between the levels of volatility or risk experienced across different time frames. Average Daily Volatility over the history of VAR has been 2% in contrast to the Average Quarterly Volatility of 24%.



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Volatility Curve of Varian Medical Systems, Inc.

If you have ever seen a "yield curve" you should be able to understand the concept behind this "yield curve". Each Volatility Curve is a snapshot in time. As the timespan across which Volatility is measured increases, the Volatility is expected to increase. The relationship between the length of time, and the expected change in price, is not linear, as is demonstrated by this chart.



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VAR: Daily Volatility Histogram

A frequency distribution of the green points on the first chart (the daily volatility) yields this histogram.



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VAR: Quarterly Volatility Histogram

Similarly, the purple points on the top chart, the Quarterly Volatility Values, are subjected to frequency distribution here.

For Subscribers: Refined Analysis of Varian Medical Systems, Inc. Volatility and Risk Behavior

Refined Volatility Risk Analysis for VAR :

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Friday, February 18, 2011: We have news on Fiserv, Inc., ticker symbol FISV. Signs of an over-bought condition have become noticable. Also, there are breaking events concerning Zimmer Holdings, Inc. and McCormick & Company, Incorporated.

From the News Archive: (2/18/2011 ) Bad news came from Reynolds American, Inc., Dollar Tree, Inc., Zimmer Holdings, Inc., and NVIDIA Corp.

More VAR Technical Analysis Topics

VAR Price Predictions

Support and Resistance Levels

Volume Stratification Analysis

Politics and Prices of VAR

Japanese Candlestick Analysis

VAR Classical Analysis of Time Series

VAR Historical Volume

VAR Seasonal Trends

Market Sentiment

Back to VAR Table of Contents


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