Could the property ‘ MEAN REVERSION’ of volatility can be explained in a general context with the help of example?
And I wasnt able to understand the LONG RUN VARIANCE RATE, Kindly help in explaining the above two.
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You can take example of Indian stock markets. Generally the long run volatility of nifty is around 18%. During covid time volatility went upto 85% bit again gradually came to 18% and today standing at 20%
ty sit