Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.


How to profit amid low volatility

Recommended Posts

Can one still make money in the low volatility financial markets? This question can be answered with mixed reactions since traders have either lost or gained during such times.

What is Volatility

Volatility being the rate at which a financial instrument moves, has both volume and price components. A highly volatile security fluctuates more than a low volatile security. Volatility is more often than note used as a measure of risk. Volatility can be aptly observed by taking a closer look at a stock’s price history.

As one of the tools used in low volatility trading, volatility index has gained popularity as it shows clearly the element of risk associated with a given stock. This is important both for amateurs and experienced traders if they are to profit from a low volatile market. Despite the fact that this index does not give a definite signal of bearish or bullish market, its interpretation shows that market fluctuation is at its highest during uncertain times.

Strategies and Tools to Use in Low Volatility Markets

Making money in low volatility markets entails employment of strategies and analytical tools. Low volatility has historically been less exciting to traders but with these latest strategies you can comfortably close your trades without much struggle and anxiety. These strategies however are not popular as such because for most of them the traders trading objective is shifted from the present and quick returns to a long term projection.

Volatility Index Defined

Volatility index also referred to as fear index is a statistical measure of the expectations in volatility and price fluctuations of the standard and poor index. When this index shows higher values, it is an indication that the Standard and Poor 500 index is poised to fluctuate.

The rising markets have been met by flat volatility and this has served as a turn off for most security traders. As the mantra goes ‘even cloud has a silver lining’ this typically means that even in the lowest of the levels of volatility one can still make money.

Calendar Spread

One such strategy is the calendar spread. This is a multi-month trading strategy which in essence makes the trader net-long volatility. Though not familiar with most security traders, this strategy is volatile-sensitive and hence with a rise in volatility, the calendar spread also appreciates in values leading to another round of increase in volatility levels.

Market volatility is occasioned primarily by market news. When significant information hits the market, market traders react in a variety of ways in response to such information. This is leads to a huge spike in volatility. Most market traders are sensitive to a price changing market information and as such are keen to monitor any bit of information entering the market.

Low volatility makes intraday moves to be less significant and this impact on most traders. Recently, most traders have been migrating from the low volatility climate to an environment where they get the opportunity to invest in major index products.


It is therefore possible to profit a mid low volatility by adopting the necessary trading strategies and tools. Making use of the volatility index and calendar spread has seen people making fortunes even in low volatile times.

Share this post

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Topics

  • Posts

    • Very long time since I made last post. Thought about posting one chart. Stock name is masked intentionally as I am having position. My views may be biased. My way of viewing chart. Chart is self explanatory
    • Litecoin Price Prediction Today: Daily (LTC) Value Forecast – July 18   LTC/USD Medium-term Trend: Bearish ·         Resistance Levels: $100, $110, $120 ·         Support levels: $90, $80, $70 Yesterday, July 17, the price of Litecoin was in a bullish trend. On July 16, the downward correction ended at the price of $80 price level. The $80 support level was the previous low of April 11 and May 6. The support level is holding as the bulls made an upward move towards the EMAs. On the upside, if the bulls break above the 12-day EMA and the 26-day EMA, the crypto’s price will rise and retest the $140 overhead resistance level. However, the bulls are likely to face resistance at the $120 price level.The MACD line and the signal line are below the zero line which indicates a sell signal.     LTC/USD Short-term Trend: Bullish On the 1-hour chart, the LTC price is in a bullish trend. The 12-day EMA and the 26-day EMA are trending upward because the price has commenced an upward movement. On July 16, in the downtrend, the bears reached a low of $76 but pulled back above the $80 price level.   Yesterday, the bulls broke above the EMAs and commenced ranging below the $94 price level. Today the bulls have broken the $94 resistance level and  are approaching the high of $100.The MACD line and the signal line are above the zero line which indicates a buy signal.     The views and opinions expressed here do not reflect that of BitcoinExchangeGuide.com and do not constitute financial advice. Always do your own research.   Source: https://bitcoinexchangeguide.co
    • CRUDE OIL Corrective Pullback Mode Remains    CRUDE OIL corrective pullback mode remains as more decline is likely in the days ahead. Support lies at the 56.50 level where a break will expose the 56.00 level. A cut through here will set the stage for a run at the 55.50 level. Further down, support comes in at the 55.00 level. Its daily RSI is a bearish and pointing lower suggesting further weakness. On the upside, resistance resides at the 57.50 levels. Further out, resistance comes in at the 58.00 level. A break above here will aim at the 58.50 level and then the 59.00 level followed by the 59.50.00 level. All in all, CRUDE OIL remains biased to the downside nearer term on pullback.  
    • I had used binance and hotforex, first one for bitcoin to altcoins and the second one for EURUSD and they also added BTCUSD and BTCEUR pair too.
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.