Flagstar Bancorp Inc Stock Volatility Hits A Collapsing Low

Flagstar Bancorp Inc (NYSE:FBC) Stock Volatility Hits A Collapsing Low

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This is a proprietary realized volatility rating created by Capital Market Laboratories (CMLviz) based on a large number of data interactions for Flagstar Bancorp Inc (NYSE:FBC) . We examine the little used gem of daily stock volatility over a 20-day and 30-day trading period, as well as comparisons to the last year and the actual stock returns over the last three- and six-months and the S&P 500 and Nasdaq 100 indices.

As a heads up, in the "Why This Matters" section at the end of this article on Flagstar Bancorp Inc (NYSE:FBC) , we're going to take a step back and show really clearly that there is actually a lot less "luck" in successful option trading than most people are aware of. This idea of an "option trading expert" is vastly over complicated so those with the information advantage can continue to profit at the expense of the rest.

But before that, let's turn back to FBC. This is a four step process for computing the realized volatility risk. Here we go.

FBC Recent Stock Volatility

Stock volatility using proprietary measures has hit a rock bottom low level. While stocks with FBC's profile see a short-term quiet period, this is also one of those times when a shake out volatility move could be on the horizon. Let's take a deep dive into some institutional level volatility measures for Flagstar Bancorp Inc (NYSE:FBC) .

Flagstar Bancorp Inc Stock Performance
FBC is down -3.9% over the last three months and down -1.1% over the last six months. The stock price is up +32.1% over the last year. The current stock price is $26.35.

FBC Step 1: Stock Returns
The one-year stock return does not impact the volatility rating since we are looking at a shorter time horizon. However, the rating does examine the 3-month returns and the absolute difference between the 3-month and 6-month returns.

  The 3-month stock return of -3.9% is too small to impact the stock volatility rating for FBC.
  The small difference between the 3-month and 6-month stock returns does not impact the stock volatility rating for FBC.

FBC Step 2: Daily Stock Volatility Level
The HV30® takes the stock's day to day historical volatility over the last 30-days and then annualizes it. The HV20 looks back over just 20-days -- a shorter time period. Here is the breakdown for Flagstar Bancorp Inc (NYSE:FBC) and how the day-by-day stock historical volatilities have impacted the rating:

  The HV20 of 15.3% is quite low and has a substantial downward impact on FBC's volatility rating.

FBC Step 3: Flagstar Bancorp Inc HV20 Compared to Indices
* The HV20 for FBC is substantially larger than that for both the S&P 500 and the NASDAQ 100 which raises the volatility rating.

* The HV20 for FBC is larger than that for the Financials ETF (XLF) which raises the volatility rating a little.

Here is summary data in tabular and chart format.

   S&P 500
   NASDAQ 100
           15.3%    6.11%    7.72%    13.49%

FBC Step 4: Daily Volatility Percentiles and Highs

We also examine the annual high of the HV30 in our rating but in this case the 52 week high in HV30 for FBC is 42.9%, which is not enough to impact the stock volatility rating.

Here is summary data in tabular and chart format.

HV30 High   
           15.3%    22.8%    42.9%

Final Stock Volatility Percentile Level: FBC
The final evolution of the volatility rating for Flagstar Bancorp Inc is a comparison of the HV30 value relative to its past, which is neatly summarized in the percentile -- a scoring mechanism that goes from a low of 1 to a high of 100.

Flagstar Bancorp Inc Realized Volatility Percentiles