New model predicts market shifts with unprecedented accuracy and precision.
A new model was created to study how volatility changes over time. It uses a special type of math to capture when volatility goes up or down, like when there's big news. This model can also show when volatility stays high or low for a while. The researchers compared their model to a common one used in finance. They found that their model can make better predictions about how risky things are. This could help with managing risks in different parts of the market.