Coefficient of Variation Formula in Forex Trading: A Guide

5 min read

The Coefficient of Variation (CV) is a statistical measure commonly used in Forex trading and analysis to measure price volatility. The formula for calculating a currency’s CV is simply the standard deviation of its prices relative to the mean of those prices. This allows traders to compare different currency pairs and determine which one has more intra-day volatility as measured over a certain period. Knowing this information can help traders set their risk parameters, and choose the instrument that best fits their trading strategies.