About the Expected Move Calculator
This expected move calculator converts an option’s implied volatility (IV) into the price range the options market is pricing in for a given number of days. Enter the stock price, the IV — from an option chain, usually the at-the-money option for the expiration you care about — and the days to expiration, and it returns the one-standard-deviation move in dollars and percent, the upper and lower bounds, and the wider two- and three-standard-deviation ranges.
Options traders use the expected move to size trades around earnings, choose strikes for iron condors, strangles and credit spreads, and judge whether a stock’s actual move was bigger or smaller than the market expected. Investors can use it to put a realistic range on where a stock might trade by a certain date.
The calculation assumes returns are normally distributed and scales annual volatility by the square root of time, so a one-standard-deviation range covers about 68% of outcomes. Choose calendar days with a 365-day year (the usual way IV is quoted on chains) or trading days with a 252-day year. Real price moves have fatter tails than the normal curve, so large moves happen more often than these probabilities suggest.
With the default inputs, the expected move (±1 standard deviation) is $12.90. Change any value above to recalculate instantly.
How to use the expected move calculator
- 1Enter the current stock price.
- 2Look up implied volatility for the expiration you care about — the at-the-money option is the usual choice.
- 3Enter the days to expiration and pick calendar or trading days.
- 4Read the ±1 SD expected move and the upper and lower bounds.
- 5Use the 2 SD and 3 SD ranges in the table to place strikes or stops further out.
Formula and method
Implied volatility σ is an annualized standard deviation of returns. To scale it to the time until expiration, multiply by the square root of the fraction of a year remaining, D ÷ Y, where Y is 365 for calendar days or 252 for trading days. Multiplying that period volatility by the stock price S gives the one-standard-deviation (1 SD) dollar move.
Under a normal distribution about 68.3% of outcomes fall within ±1 SD, 95.4% within ±2 SD and 99.7% within ±3 SD. The table also shows lognormal bounds, S × e^(±kσ√t), which never go below zero and are slightly skewed upward. An at-the-money straddle is worth roughly √(2/π) ≈ 0.8 of the 1 SD move, which is why traders often quote the straddle price as a quick expected-move estimate.
- S
- Current stock price
- σ
- Implied volatility (annual, as a decimal)
- D
- Days to expiration
- Y
- Days per year — 365 calendar or 252 trading
- k
- Number of standard deviations
Worked examples
$150 stock, 30% IV, 30 days
Period volatility is 30% × √(30/365) = 8.60%, so the 1 SD move is $150 × 8.60% ≈ $12.90. The market prices a roughly 68% chance the stock ends between $137.10 and $162.90, and 95% between $124.20 and $175.80. Scaled to a single calendar day, the 1 SD move is $150 × 30% ÷ √365 ≈ $2.36.
Index ETF, 18% IV, one week
Over 7 calendar days, 18% annual volatility scales to 18% × √(7/365) ≈ 2.49%. On a $420 ETF that is about ±$10.47, a range of $409.53 to $430.47.
High-IV stock using trading days
With a 252-day year, 10 trading days is 10/252 of a year, so period volatility is 65% × √(10/252) ≈ 12.95% and the 1 SD move is about $11.01. Even the 2 SD lower bound is near $63, showing how wide high-IV ranges get.
Frequently asked questions
How do you calculate the expected move of a stock?+
Multiply the stock price by implied volatility and by the square root of days to expiration divided by 365. For a $100 stock with 40% IV and 30 days left, the expected move is 100 × 0.40 × √(30/365) ≈ $11.47.
What is the straddle method for expected move?+
Many traders take the price of the at-the-money straddle (call plus put) as a quick estimate. Under standard assumptions the straddle is worth about 0.8 of the 1 SD move, so the straddle price slightly understates the 1 SD range; some traders multiply it by about 1.25 to convert.
Should I use 365 or 252 days?+
Implied volatility on most option chains is annualized with calendar days, so use 365 with calendar days to expiration. If you count only trading days, use 252. Mixing the two — trading days with a 365-day year — understates the move.
How accurate is the expected move?+
It is the range implied by option prices, not a forecast. Implied volatility has tended on average to run above the volatility that is later realized (the volatility risk premium), so the range is often a little wide — but real returns have fatter tails than a normal distribution, so moves well beyond 2 SD happen more often than the 4.6% the bell curve suggests.
Why is the expected move bigger before earnings?+
Implied volatility rises ahead of scheduled events such as earnings because the market expects a large one-day move. After the announcement IV usually drops sharply — the "volatility crush" — and the expected move for the remaining days shrinks.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.