Options expected move calculator
Project a stock’s expected move and probable range from implied volatility.
Runs 100% in your browser- Expected move (±1σ)
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- 1σ range (~68%)
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- 2σ range (~95%)
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How to calculate the expected move
- Enter the stock price. Type the current price of the stock or index.
- Enter IV and days. Add the implied volatility (%) and days until your date or expiration.
- Read the move and range. See the expected dollar move, percent, and the 1σ / 2σ price ranges.
The one-sigma range
The expected move is one standard deviation of price change over a chosen horizon: spot × IV × √(time in years). Because volatility scales with the square root of time, a 32% annual IV implies a far smaller move over a single week than over a year — you cannot just divide the annual figure by the number of weeks. Statistically, a stock finishes inside its one-sigma band roughly 68% of the time and outside it about a third of the time, so the expected move is a likely range, not a ceiling. Two standard deviations (multiply by two) covers about 95% of outcomes and is the band many traders actually plan around.
Framing a trade around it
The most common use is earnings: the expected move tells you the swing the options market has already priced in, so you can judge whether a reaction is "big" only relative to what was expected. If a stock moves less than its expected move on the news, premium sellers who positioned outside the band tend to win; if it moves more, long-premium buyers do. It also anchors strike selection — credit sellers place short strikes at or just beyond the expected move to keep a probability edge, while spread buyers look for a directional move larger than the range. It is the same √time scaling behind the rule of 16, just expressed in dollars rather than a daily percentage.
What it does not tell you
The model assumes a roughly normal distribution of returns, but real stocks have fatter tails — large gaps happen more often than the bell curve predicts, which is exactly why far out-of-the-money options trade richer than the formula alone suggests. The expected move also says nothing about direction; it is a symmetric band around the current price. Get a reliable IV input from the implied-volatility calculator, and price specific strikes inside or outside the band with the Black-Scholes calculator.
Educational tool only — not financial advice. The expected move is a probability estimate assuming a normal distribution, not a guarantee. Options trading carries a high level of risk.
Frequently asked questions
- The expected move is roughly one standard deviation of where a stock could be by a date, implied by option prices. It is calculated as stock price × implied volatility × √(days ÷ 365), and there is about a 68% chance the stock finishes within that range.
- About 68% of the time the stock should land within ±1 standard deviation (1σ), and about 95% within ±2σ — assuming a normal distribution. They are probabilities, not guarantees.
- Implied volatility is quoted on a calendar-year basis, so this uses calendar days ÷ 365. Some traders prefer trading days; the difference is small for short windows.
- Use the at-the-money implied volatility for your expiration. The implied-volatility calculator backs it out from an option’s market price.
- No — everything is computed in your browser.