Nvidia Stock Volatility

NVDA
 Stock
  

USD 180.97  10.11  5.92%   

Nvidia Corp appears to be very steady, given 3 months investment horizon. Nvidia Corp has Sharpe Ratio of 0.0656, which conveys that the firm had 0.0656% of return per unit of risk over the last 3 months. Our standpoint towards estimating the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-seven technical indicators for Nvidia Corp, which you can use to evaluate the future volatility of the firm. Please exercise Nvidia Corp's risk adjusted performance of (0.014673), and Mean Deviation of 3.23 to check out if our risk estimates are consistent with your expectations.
  
Nvidia Corp Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Nvidia daily returns, and it is calculated using variance and standard deviation. We also use Nvidia's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Nvidia Corp volatility.

720 Days Market Risk

Very steady

Chance of Distress

Very Small

720 Days Economic Sensitivity

Hyperactively responds to market trends
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Nvidia Corp can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Nvidia Corp at lower prices. For example, an investor can purchase Nvidia stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Nvidia Corp's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with Nvidia Corp

0.79APHAmphenol CorpPairCorr
0.73BHEBenchmark ElectronicsPairCorr
0.85CLSCelesticaPairCorr

Nvidia Corp Market Sensitivity And Downside Risk

Nvidia Corp's beta coefficient measures the volatility of Nvidia stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Nvidia stock's returns against your selected market. In other words, Nvidia Corp's beta of 2.35 provides an investor with an approximation of how much risk Nvidia Corp stock can potentially add to one of your existing portfolios.
Nvidia Corp exhibits very low volatility with skewness of 0.03 and kurtosis of -0.4. However, we advise investors to further study Nvidia Corp technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Nvidia Corp's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Nvidia Corp's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Nvidia Corp Implied Volatility

Nvidia Corp's implied volatility exposes the market's sentiment of Nvidia Corp stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Nvidia Corp's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Nvidia Corp stock will not fluctuate a lot when Nvidia Corp's options are near their expiration.
3 Months Beta |Analyze Nvidia Corp Demand Trend
Check current 90 days Nvidia Corp correlation with market (DOW)

Nvidia Beta

    
  2.35  
Nvidia standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  3.92  
It is essential to understand the difference between upside risk (as represented by Nvidia Corp's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Nvidia Corp stock's daily returns or price. Since the actual investment returns on holding a position in Nvidia Corp stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Nvidia Corp.

Using Nvidia Put Option to Manage Risk

Put options written on Nvidia Corp grant holders of the option the right to sell a specified amount of Nvidia Corp at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Nvidia Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Nvidia Corp's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Nvidia Corp will be realized, the loss incurred will be offset by the profits made with the option trade.

Nvidia Corp's PUT expiring on 2022-08-12

   Profit   
Share
       Nvidia Corp Price At Expiration  

Current Nvidia Corp Insurance Chain

DeltaGammaOpen IntExpirationCurrent SpreadLast Price
Put
2022-08-12 PUT at $260.0-0.89010.003622022-08-1286.6 - 91.5568.1View
Put
2022-08-12 PUT at $250.0-0.97670.001822022-08-1277.8 - 80.9577.65View
Put
2022-08-12 PUT at $225.0-0.88160.005412022-08-1251.6 - 56.5556.05View
Put
2022-08-12 PUT at $220.0-0.85760.0061192022-08-1246.6 - 51.5541.85View
Put
2022-08-12 PUT at $217.5-0.85430.006412022-08-1244.1 - 49.0533.4View
Put
2022-08-12 PUT at $212.5-0.84860.007182022-08-1239.1 - 44.044.45View
Put
2022-08-12 PUT at $210.0-0.96470.0054922022-08-1237.8 - 40.9541.98View
Put
2022-08-12 PUT at $207.5-0.8670.0077162022-08-1234.6 - 38.3520.9View
Put
2022-08-12 PUT at $205.0-0.85790.0083702022-08-1231.9 - 35.9532.07View
Put
2022-08-12 PUT at $202.5-0.85510.0089532022-08-1229.5 - 33.428.51View
Put
2022-08-12 PUT at $200.0-0.99460.00154822022-08-1228.9 - 29.428.78View
View All Nvidia Corp Options

Nvidia Corp Stock Volatility Analysis

Volatility refers to the frequency at which Nvidia Corp stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Nvidia Corp's price changes. Investors will then calculate the volatility of Nvidia Corp's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Nvidia Corp's volatility:

Historical Volatility

This type of stock volatility measures Nvidia Corp's fluctuations based on previous trends. It's commonly used to predict Nvidia Corp's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Nvidia Corp's current market price. This means that the stock will return to its initially predicted market price.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Nvidia Corp Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
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Nvidia Corp Projected Return Density Against Market

Given the investment horizon of 90 days the stock has the beta coefficient of 2.3544 . This indicates as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Nvidia Corp will likely underperform.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Nvidia Corp or Technology sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Nvidia Corp stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Nvidia stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has a negative alpha, implying that the risk taken by holding this instrument is not justified. Nvidia Corp is significantly underperforming DOW.
   Predicted Return Density   
       Returns  
Nvidia Corp's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how Nvidia Corp stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Company's Stock Price Volatility?

Several factors can influence a company's stock volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Nvidia Corp Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Nvidia Corp or Technology sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Nvidia Corp stock's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Nvidia stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Given the investment horizon of 90 days the coefficient of variation of Nvidia Corp is 1525.4. The daily returns are distributed with a variance of 15.34 and standard deviation of 3.92. The mean deviation of Nvidia Corp is currently at 3.16. For similar time horizon, the selected benchmark (DOW) has volatility of 1.25
α
Alpha over DOW
-0.05
β
Beta against DOW2.35
σ
Overall volatility
3.92
Ir
Information ratio -0.02

Nvidia Corp Stock Return Volatility

Nvidia Corp historical daily return volatility represents how much Nvidia Corp stock's price daily returns swing around its mean daily price change - it is a statistical measure of its dispersion of returns. The company inherits 3.9167% risk (volatility on return distribution) over the 90 days horizon. By contrast, DOW inherits 1.2745% risk (volatility on return distribution) over the 90 days horizon.
 Performance (%) 
       Timeline  

About Nvidia Corp Volatility

Volatility is a rate at which the price of Nvidia Corp or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Nvidia Corp may increase or decrease. In other words, similar to Nvidia's beta indicator, it measures the risk of Nvidia Corp and helps estimate the fluctuations that may happen in a short period of time. So if prices of Nvidia Corp fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2022
Market Capitalization369.9 B399.1 B
NVIDIA Corporation provides graphics, and compute and networking solutions in the United States, Taiwan, China, and internationally. The companys Graphics segment offers GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms QuadroNVIDIA RTX GPUs for enterprise workstation graphics vGPU software for cloud-based visual and virtual computing automotive platforms for infotainment systems and Omniverse software for building 3D designs and virtual worlds. Its Compute Networking segment provides Data Center platforms and systems for AI, HPC, and accelerated computing Mellanox networking and interconnect solutions automotive AI Cockpit, autonomous driving development agreements, and autonomous vehicle solutions cryptocurrency mining processors Jetson for robotics and other embedded platforms and NVIDIA AI Enterprise and other software. The companys products are used in gaming, professional visualization, datacenter, and automotive markets. NVIDIA Corporation sells its products to original equipment manufacturers, original device manufacturers, system builders, add-in board manufacturers, retailersdistributors, independent software vendors, Internet and cloud service providers, automotive manufacturers and tier-1 automotive suppliers, mapping companies, start-ups, and other ecosystem participants. It has a strategic collaboration with Kroger Co. NVIDIA Corporation was incorporated in 1993 and is headquartered in Santa Clara, California.

Nvidia Corp Investment Opportunity

Nvidia Corp has a volatility of 3.92 and is 3.09 times more volatile than DOW. 33  of all equities and portfolios are less risky than Nvidia Corp. Compared to the overall equity markets, volatility of historical daily returns of Nvidia Corp is lower than 33 () of all global equities and portfolios over the last 90 days.
Use Nvidia Corp to enhance the returns of your portfolios. Benchmarks are essential to demonstrate the utility of optimization algorithms. The stock experiences a very speculative upward sentiment. Check odds of Nvidia Corp to be traded at $226.21 in 90 days. .

Poor diversification

The correlation between Nvidia Corp and DJI is Poor diversification for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Nvidia Corp and DJI in the same portfolio, assuming nothing else is changed.

Nvidia Corp Additional Risk Indicators

The analysis of Nvidia Corp's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Nvidia Corp's investment and either accepting that risk or mitigating it. Along with some common measures of Nvidia Corp stock risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Risk Adjusted Performance(0.014673)
Market Risk Adjusted Performance(0.023487)
Mean Deviation3.23
Coefficient Of Variation(5,818)
Standard Deviation4.01
Variance16.04
Information Ratio(0.016553)
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stock investments, we recommend comparing similar equities with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Nvidia Corp Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Nvidia Corp as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Nvidia Corp's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Nvidia Corp's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Nvidia Corp.
Additionally, see Stocks Correlation. Note that the Nvidia Corp information on this page should be used as a complementary analysis to other Nvidia Corp's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Focused Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.

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When running Nvidia Corp price analysis, check to measure Nvidia Corp's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Nvidia Corp is operating at the current time. Most of Nvidia Corp's value examination focuses on studying past and present price action to predict the probability of Nvidia Corp's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Nvidia Corp's price. Additionally, you may evaluate how the addition of Nvidia Corp to your portfolios can decrease your overall portfolio volatility.
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Is Nvidia Corp's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Nvidia Corp. If investors know Nvidia will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Nvidia Corp listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Nvidia Corp is measured differently than its book value, which is the value of Nvidia that is recorded on the company's balance sheet. Investors also form their own opinion of Nvidia Corp's value that differs from its market value or its book value, called intrinsic value, which is Nvidia Corp's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Nvidia Corp's market value can be influenced by many factors that don't directly affect Nvidia Corp's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Nvidia Corp's value and its price as these two are different measures arrived at by different means. Investors typically determine Nvidia Corp value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Nvidia Corp's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.