The Value of a Call Increases When the Volatility of the Price

question 156

True/False

The value of a call increases when the volatility of the price of the underlying stock increases.

---

Definitions:

Z Scores

An index showing the variance of a specific value from the mean of a group, calculated through its number of standard deviations from the mean.

Probability

A measure of the likelihood that an event will occur, defined on a scale from 0 to 1.

Confidence

The degree to which one can be certain about the accuracy of a result, often quantified in statistics through a confidence interval.

Skewness

A measure of the asymmetry of the probability distribution of a real-valued random variable about its mean.