Quantitative Finance
# Options

How is historical trading-day volatility measured?

Step 1:

A) Calculate the absolute change in closing prices as the data set.

B) Calculate the percentage change in closing prices as the data set.

Step 2:

C) Calculate the standard deviation of the data set.

D) Calculate the variance of the data set.

Step 3:

E) Multiply it by $\sqrt{ 260}$.

F) Multiply it by $\sqrt{365}$.

When would you want to early exercise an American call?

When would you early exercise an American put option on a stock that doesn't pay dividends?