BROWSE

Range

What is a 'Range'

The difference between the low and high prices for a security or index over a specific time period. Range defines the price spread for a defined period, such as a day or year, and indicates the security’s price volatility. The more volatile the security or index, the wider the range. The range expands over greater time periods; a security’s daily range will generally be smaller than its 52-week range, which in turn will be tighter than its five-year or 10-year range. Technical analysts closely follow ranges since they are very useful in pinpointing entry and exit points for trades.

Explaining 'Range'

The range depends on the type of security; and for a stock, the sector in which it operates. For example, the range for fixed-income instruments is much tighter than that for commodities and equities, which are more volatile in price. Even for fixed-income instruments, a Treasury bond or government security will typically have a smaller trading range than a junk bond or convertible security.


Further Reading


The long-range dependence paradigm for macroeconomics and finance
books.google.com [PDF]
Page 437. The Long-Range Dependence Paradigm for Macroeconomics and Finance Marc Henry Paolo Zaffaroni ABSTRACT The long-range … We discuss empirical evidence of long-range dependence as well as the theoretical issues, both for economics and econometrics …

Range volatility models and their applications in financeRange volatility models and their applications in finance
link.springer.com [PDF]
Page 437. The Long-Range Dependence Paradigm for Macroeconomics and Finance Marc Henry Paolo Zaffaroni ABSTRACT The long-range … We discuss empirical evidence of long-range dependence as well as the theoretical issues, both for economics and econometrics …

Stock market prices and long-range dependenceStock market prices and long-range dependence
link.springer.com [PDF]
Page 437. The Long-Range Dependence Paradigm for Macroeconomics and Finance Marc Henry Paolo Zaffaroni ABSTRACT The long-range … We discuss empirical evidence of long-range dependence as well as the theoretical issues, both for economics and econometrics …

Trends in park tourism: Economics, finance and managementTrends in park tourism: Economics, finance and management
www.tandfonline.com [PDF]
Page 437. The Long-Range Dependence Paradigm for Macroeconomics and Finance Marc Henry Paolo Zaffaroni ABSTRACT The long-range … We discuss empirical evidence of long-range dependence as well as the theoretical issues, both for economics and econometrics …



Q&A About Range


How do you calculate monthly range of an asset?

The formula is ((high - low) / high) * 30.

How do you calculate daily range of an asset?

The formula is (high - low) / (high + low).

How do you calculate weekly range of an asset?

The formula is ((high - low) / high) * 7.

What is the difference between a range and volatility?

Range defines the price spread for a defined period, such as a day or year, and indicates the security's price volatility. Volatility refers to how much prices change over time.

What does technical analysts closely follow ranges for?

Technical analysts closely follow ranges since they are very useful in pinpointing entry and exit points for trades.

What factors affect range of assets?

Sector, market capitalization, liquidity, trading volume, and volatility will all affect the range of assets. For example, fixed income instruments have tighter ranges than equities because they are less volatile in price movements. Also junk bonds will have wider ranges than government securities due to their higher volatility in price movements. Liquidity also affects the size of the range; if there are more buyers than sellers then prices tend to rise while if there are more sellers than buyers then prices tend to fall which increases the size of the trading range on that particular day or week depending on how long it takes for supply/demand to equalize again at that level."