Glossary

It should set your position size. Equal rupees in a calm and a volatile stock is not equal risk.

The most reliable property of the series — and the reason a low reading describes the recent past rather than promising a quiet future.

It is why you can be right about the direction of the underlying and still lose on the option. The input that moved is not visible anywhere on the premium chart.

The one thing on a chart that genuinely mean-reverts. Direction does not.

The axis most traders ignore. A trend can stay intact and still become too wild for your usual stop.

Hold risk per position constant and let the rupee value float — the opposite of equal amounts.

Gives the trade room to breathe. Combine it with structure: find the level, then check it clears one ATR.

It rises before known events and collapses afterwards, which is why buying options into results often disappoints.

On top, never instead. Adding it to SPAN is what turns the leverage figure people quote into the real one — usually nearer five or six times contract value than the number an advertisement implies.

Misleading, because it implies direction. It measures how much movement is priced, and rises just as readily on a violent rally.

The fear gauge. Normally in the low teens; it tripled during the March 2020 crash.

Rates and the rupee are the tide. Studying one boat will not reveal it.

For a chart reader the consequence matters more than the intent: a stretch of unusually small ranges is not by itself evidence that the next move will be small, so volatility measured over a quiet window understates what a stop has to survive.

The strike with the largest call open interest often acts as resistance and the largest put strike as support, because writers hedging those positions generate real buying and selling. One source of confluence, not a forecast.

What a VIX spike actually tells you: protection has become expensive. That is a statement about what to trade, not which way.

Not what you say when calm. What you did the last time you were down 30%.

Penalises upside volatility equally and flatters strategies that quietly sell tail risk.

It rises when volatility rises, which is precisely the day the position is losing money. The margin call and the loss are correlated by design, and that correlation is what turns a bad session into a forced exit.

Predicts the size of the coming move, never its direction.

Serious research usually precedes it, and it brings volatility with it — they can sell for global reasons. Check whether FIIs are leaving the whole market before reading it as a verdict on this company.

Captures roughly three-quarters of the growth for about half the volatility, and forgives the thing that actually goes wrong: overestimating the edge.

Lower volatility, milder gaps, stronger mean reversion, almost no company-specific risk. Different enough to justify genuinely different rules.

Reduces volatility and expectancy together. Worth it only if it lets you hold the rest calmly.

Trend systems want expanding volatility; mean-reversion systems want it settled. Neither is broken when the regime changes — it is just out of season.

Volatility spikes for a few sessions and subsides quickly. It is a reason to size smaller, not a reason to take a direction.