... therefore change the range ofimplied and historical volatility.c05 JWBK 147 -Smith April 25, 2008 8 :42 Char Count=Volatility 616050 40 30201001357911131517192123252729313335373 941 4 345 4 749 5153555759DaysPriceFIGURE ... distributionExercise priceFIGURE 5 .4 Normal Volatilityc05 JWBK 147 -Smith April 25, 2008 8 :42 Char Count=CHAPTER 5VolatilityVOLATILITY AND THE OPTIONS TRADERVolatility is important for the options trader. The ... and during a trade.c05 JWBK 147 -Smith April 25, 2008 8 :42 Char Count= 64 WHY AND HOW OPTION PRICES MOVEHowever, the normal distribution is far too inaccurate for options pricing.A lognormal...