Implied Volatility 
Implied Volatility is a forwardlooking volatility measure implied through the option prices in the market. The price of an option depends on the strike price, tenor, volatility and others. If strike, tenor and others are fixed, you can derive the volatility number directly from the option price.
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Black Scholes Implied Volatility Surface The most useful implied volatility measure is the VIX which is the expected (implied) annualized volatility the options market expects for the US Stock Market S&P 500 over the 30 upcoming days A VIX of 15 means that the market expects a 15% annualized volatility over the next 30 days. This translates to a 4.33% up or down move in the S&P 500 for the upcoming month (15%/sqrt(12)). Implied Volatility is calculated explicitely using numerical methods based on the Black Scholes formula which is part of the Options Basics section. Implied Volatility Calculation Steps
