Expected price range for Total stock until December 31, 2018
In the previous part, we looked at Total’s (TOT) moving average trend. Now, we’ll consider its implied volatility to forecast its stock price range until December 31, 2018.
Implied volatility in Total has risen by 8.1 percentage points over October 1, 2018, to the current level of 27.2%. In the same period, Total stock has fallen 20.9%.
Considering Total’s implied volatility of 27.2% and assuming a normal distribution of prices (bell curve model) and a standard deviation of one (with a probability of 68.2%), Total stock could close between $54.1 per share and $49.4 per share for the ten days ending December 31, 2018.
Implied volatility in peers
Like Total, implied volatility in PetroChina (PTR) has risen by 5.8 percentage points over October 1 to 32.9%. Also, implied volatilities in YPF (YPF) and ENI (E) have increased by 7.1 percentage points and 11.1 percentage points, respectively, in the same period. YPF and ENI’s implied volatilities currently stand at 51.8% and 29.9%, respectively. In the stated period, PetroChina, YPF, and ENI stocks have fallen by 25.8%, 16.9%, and 18.9%, respectively.
Also, implied volatilities in the SPDR Dow Jones Industrial Average ETF (DIA) and the SPDR S&P 500 ETF (SPY), which closely resemble the Dow Jones Industrial Average and the S&P 500 Index, respectively, have risen.
Implied volatilities in DIA and SPY have risen by 16.4 percentage points and 17.4 percentage points, respectively, over October 1 to the current level of 26.3% and 25.3%, respectively. However, in the same period, DIA and SPY have fallen 16.0% and 17.5%, respectively.
In the next part, we’ll review Total’s dividend yield trend.