# Generalized volatility for time T

## Description

In finance, volatility is a measure for variation of price of a financial instrument over time. An implied volatility is derived from the market price of a market traded derivative (in particular an option). The annualized volatility σ is the standard deviation of the instrument’s yearly logarithmic returns.

The generalized volatility σT for time horizon T in years is related to the standard deviation and the time horizon T in years.

## Variables

σ_{T} | The generalized volatility for time T (dimensionless) |

σ | The standard deviation of the instrument's yearly logarithmic returns (dimensionless) |

T | Time in years (dimensionless) |