Predicting S&P 500 volatility for intermediate time horizons using implied forward volatility

Thorsten M. Egelkraut, Philip Garcia

Research output: Contribution to journalArticlepeer-review

Abstract

This paper finds that the implied forward volatility of S&P 500 futures options contains significant explanatory power regarding sunsequent realized volatility during intermediate future time intervals. It provides rational, unbiased, and informationally efficient predictions and dominates all alternative volatility forecasts considered.

Original languageEnglish (US)
Pages (from-to)31-34
Number of pages4
JournalApplied Economics Letters
Volume15
Issue number1
DOIs
StatePublished - Jan 2008

ASJC Scopus subject areas

  • Economics and Econometrics

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