On March 5, FirstEnergy (FE) stock had an implied volatility of 15%, which is close to its 15-day average volatility. In comparison, the Utilities Select Sector SPDR ETF (XLU) had an implied volatility of 11%.
The implied volatility indicates investors’ anxiety. Rising volatility is usually associated with falling stock prices.
Although utilities are considered slow and steady stocks, their implied volatility has been higher than the S&P 500’s implied volatility over the longer period.
To learn more, read Utilities Recap: The Big Gains and Losses Last Week.