# Custom Formula Collection

Natenberg's Volatility

Historical volatility is defined by Sheldon Natenberg, as the standard deviation of the logarithmic price changes measured at regular intervals of time. In Mr. Natenberg's book, Option Volatility &
Pricing
, he covers volatility in detail and gives the formula for computing historical volatility. In MetaStockTM the equivalent formula would be:

Std( Log( C / Ref( C ,-1 ) ) ,10 ) * Sqrt( 365 / 7 )

This assumes Weekly Data. To utilize this with Daily Data, the formula would be:

Std( Log( C / Ref( C,-1) ),10 ) * Sqrt( 365 )

For further interpretation refer to the book Option Volatility &
Pricing
, by Sheldon Natenberg.

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