Bitcoin Volatility Movement Has Been Less Than Amazon, Netflix, And Nvidia for Past 3 Weeks
For The Past 20 Days, Bitcoin Has Been Less Volatile Than Amazon, Netflix, And Nvidia
Bitcoin has been historically scrutinized for their volatility, a characteristic which is often referred to as a barrier for crypto adoption in terms of real-world usage and increased interest from institutional investors. However, new data shows that the biggest cryptocurrency by market cap is actually less volatile than some of the largest and most popular stocks trading on Wall Street.
Now, recent research has found that the top cryptocurrency is less volatile than some of the most popular stocks traded in traditional markets. According to Cboe Global Markets, the historical volatility over the past 20 days has declined to a low of 31.5%. In reference, Amazon, Netflix and Nvidia stocks are all more volatile than Bitcoin, at 35%, 52%, and 40% respectively.
The Times They Are A Changin
Looking back to January, when the price of Bitcoin was tumbling from the all-time-highs of almost $20,000 registered in late-2017, the coin’s 20-day HV reached an astonishing 140% — almost 5 times higher than it is today. However, it still pales in comparison to the volatility exhibited by the security of Tilray, a cannabis producing company. Tilray stocks are currently exhibiting a historic volatility of 219%.
Another related data point is Bitcoin’s standard deviation. In statistics, the standard deviation is a measure that is used to quantify the amount of variation in a set of data values. For our purposes, the standard deviation of Bitcoin can be used as a measure of volatility.
The volatility of Bitcoin is approaching that of Apple, at 29.3%. Kevin Davitt, a senior instructor at the Options Institute at CBOE, stated:
“A one standard deviation move for bitcoin at present is about $475. That works out to +/- 7.3% (475/6500). Compare that to earlier this year (mid-January) when bitcoin was around $11,000. Back then the standard deviation measured $4640 or +/- 42%.”
Davitt continued: “Perhaps we are witnessing the maturation of the market. It’s far too early to declare this the ‘new normal’ but the persistent range over the last few weeks may be hinting at a structural shift. Time will tell.”