Whiting Petroleum’s implied volatility
Whiting Petroleum (WLL) has an implied volatility of ~68.16%, which is ~12% higher than its 15-day average of ~61%. By comparison, peers Oasis Petroleum (OAS) and Newfield Exploration (NFX) have implied volatilities of ~58.2% and ~37.5%, respectively. These companies account for 6.3% of the Energy Select Sector SPDR ETF (XLE).
Using implied volatility to forecast a stock price range
Based on Whiting Petroleum’s implied volatility—and assuming a normal distribution of stock prices (statistically known as the “bell curve”) and one standard deviation (probability of 68.2%)—Whiting Petroleum stock could likely close between $7.75 and $9.37 in the next seven days.
In the next part of this series, we’ll look at analysts’ price targets for Whiting Petroleum for the next 12 months.