Historical Volatility (Statistical Volatility) is the annualized standard deviation of past stock price movements. It measures the daily price changes in the stock over the past year. The best part of this indicator is that it can be used to predict the probability of a stock reaching a particular target price and thus can help you in building a position in stock or an option contract. However it must be noted that while historical volatility can be indicative of future volatility, it can also differ greatly from future volatility, depending on what was driving the price changes during the past period. Major expected news items are more important drivers of big moves in the stock price in the near future.
Morningstar publishes historical volatility data for individual stocks and indices. For example if you need to check what is the statistical volatility of IBM, key-in the ticker and look for the highlighted area below. It shows volatility data for 1 month to 3 years.
