# Define Implied Volatility (IV) and Contrast It with Historical Volatility (HV) ⎊ Path

**Published:** 2025-12-04
**Author:** Greeks.live
**Categories:** Path

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## Define Implied Volatility (IV) and Contrast It with Historical Volatility (HV).

Implied Volatility (IV) is a forward-looking metric derived from the current option price, representing the market's expectation of future price movement. Historical Volatility (HV) is a backward-looking measure, calculated from the underlying asset's past price changes over a specific period.

IV is what traders expect ; HV is what has happened.

- [What Is the Difference between Historical and Implied Volatility?](https://learn.greeks.live/path/what-is-the-difference-between-historical-and-implied-volatility/)

- [Differentiate between Historical Volatility and Implied Volatility](https://learn.greeks.live/path/differentiate-between-historical-volatility-and-implied-volatility/)

- [How Is ‘Historical Volatility’ Different from ‘Implied Volatility’ in the Context of Options Trading?](https://learn.greeks.live/path/how-is-historical-volatility-different-from-implied-volatility-in-the-context-of-options-trading/)

- [Explain the Difference between ‘Historical Volatility’ and ‘Implied Volatility’ in Margin Models](https://learn.greeks.live/path/explain-the-difference-between-historical-volatility-and-implied-volatility-in-margin-models/)

- [How Does Implied Volatility in Options Differ from Historical Volatility in Cryptocurrency Prices?](https://learn.greeks.live/path/how-does-implied-volatility-in-options-differ-from-historical-volatility-in-cryptocurrency-prices/)

- [Distinguish between Historical Volatility and Implied Volatility (IV)](https://learn.greeks.live/path/distinguish-between-historical-volatility-and-implied-volatility-iv/)

- [Define ‘Implied Volatility’ and How It Differs from ‘Historical Volatility’](https://learn.greeks.live/path/define-implied-volatility-and-how-it-differs-from-historical-volatility/)

- [How Is “Historical Volatility” Different from Implied Volatility?](https://learn.greeks.live/path/how-is-historical-volatility-different-from-implied-volatility/)

## Glossar

### [Historical Volatility (HV)](https://learn.greeks.live/area/historical-volatility-hv/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Metric ⎊ Historical Volatility (HV) serves as a quantitative measure of the dispersion of an asset's returns over a specified look-back period, providing an objective, backward-looking assessment of price movement magnitude.

## Discover More

### [What Are Some Historical Examples of Network Upgrades That Led to Bearish Sentiment?](https://learn.greeks.live/path/what-are-some-historical-examples-of-network-upgrades-that-led-to-bearish-sentiment/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Are Some Historical Examples of Network Upgrades That Led to Bearish Sentiment?](https://learn.greeks.live/wp-content/uploads/2025/10/Hard-Disk-Platter-Data-Access-Spindle-Metaphor-for-Decentralized-Finance-Derivative-Execution-Speed.webp)

The Bitcoin Cash hard fork and the Ethereum DAO hack are examples of upgrades that created bearish sentiment.

### [Define the Term 'Synthetic Long' and How It Relates to Put and Call Options](https://learn.greeks.live/path/define-the-term-synthetic-long-and-how-it-relates-to-put-and-call-options/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Define the Term 'Synthetic Long' and How It Relates to Put and Call Options](https://learn.greeks.live/wp-content/uploads/2025/10/Geometric-Intersection-of-Speculative-Asset-Structures-Highlighting-Bifurcation-Risks-in-Digital-Asset-Hedging.webp)

A strategy of buying a call and selling a put (same strike/expiration) that replicates the payoff of holding the underlying asset.

### [What Is the Historical Impact of Bitcoin Halvings on Its Market Price?](https://learn.greeks.live/path/what-is-the-historical-impact-of-bitcoin-halvings-on-its-market-price/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Historical Impact of Bitcoin Halvings on Its Market Price?](https://learn.greeks.live/wp-content/uploads/2025/10/Abstract-Representation-of-Decentralized-Finance-Oracle-Mechanism-and-Volatility-Skew-Observation.webp)

Historically, Bitcoin halvings have caused a supply shock, leading to significant bull runs in the market price to compensate for reduced miner rewards.

### [Define the Term 'Implied Probability' as It Relates to an Option's Delta](https://learn.greeks.live/path/define-the-term-implied-probability-as-it-relates-to-an-options-delta/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Define the Term 'Implied Probability' as It Relates to an Option's Delta](https://learn.greeks.live/wp-content/uploads/2025/10/Layered-Material-Abstraction-Modeling-Volatility-Skew-in-Cryptocurrency-Hedging-Instruments.webp)

Delta approximates the market's implied probability that an option will expire In-the-Money (ITM).

### [What Is Implied Volatility and How Is It Derived?](https://learn.greeks.live/path/what-is-implied-volatility-and-how-is-it-derived/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is Implied Volatility and How Is It Derived?](https://learn.greeks.live/wp-content/uploads/2025/10/Hypersonic-Missile-Aerodynamics-Modeling-High-Frequency-Crypto-Derivative-Execution-Mechanisms.webp)

Implied volatility is the market's expectation of future crypto price volatility, derived by reverse-engineering the option premium.

### [Why Might a Trader Focus More on Implied Volatility than Historical Volatility?](https://learn.greeks.live/path/why-might-a-trader-focus-more-on-implied-volatility-than-historical-volatility/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Why Might a Trader Focus More on Implied Volatility than Historical Volatility?](https://learn.greeks.live/wp-content/uploads/2025/10/Macro-Focus-on-Optic-Sensor-Housing-for-Decentralized-Autonomous-Organization-Governance-Surveillance.webp)

Traders prefer implied volatility because it's a forward-looking measure of expected risk, unlike backward-looking historical data.

### [Are There Historical Precedents for How Crypto Assets Are Treated in Bankruptcy?](https://learn.greeks.live/path/are-there-historical-precedents-for-how-crypto-assets-are-treated-in-bankruptcy/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Are There Historical Precedents for How Crypto Assets Are Treated in Bankruptcy?](https://learn.greeks.live/wp-content/uploads/2025/10/Bifurcated-Polychromatic-Enclosures-Simulating-Decentralized-Exchange-Order-Book-Separation.webp)

Yes, cases like Mt. Gox and Celsius have shown that user assets can be treated as company property.

### [What Is Implied Volatility and Why Is It Crucial for Crypto Options Pricing?](https://learn.greeks.live/path/what-is-implied-volatility-and-why-is-it-crucial-for-crypto-options-pricing/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is Implied Volatility and Why Is It Crucial for Crypto Options Pricing?](https://learn.greeks.live/wp-content/uploads/2025/10/Reflective-Sphere-Oscillation-on-Oblique-Planes-Signaling-Volatility-Surface-Implied-Skew.webp)

Implied volatility is the market's future volatility expectation, directly determining the option's premium.

### [Define "Implied Volatility" (IV) and Its Importance for Options Pricing](https://learn.greeks.live/path/define-implied-volatility-iv-and-its-importance-for-options-pricing/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Define "Implied Volatility" (IV) and Its Importance for Options Pricing](https://learn.greeks.live/wp-content/uploads/2025/10/Interlocking-Oscillating-Digital-Asset-Structures-Representing-Volatility-Surface-Topology-in-DeFi-Options.webp)

IV is the market's forecast of future volatility, derived from the option price, and directly impacts the premium.

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