Price & Market BehaviorExtended setlive in productionNew

intraday volatility-spike reversal

Updated dailyData needs: highlong onlyshort onlylong short
paper
2020
Source
Bollerslev, T., Li, S. Z., & Zhao, B. (2020). Good Volatility, Bad Volatility, and the Cross Section of Stock Returns. Journal of Financial and Quantitative Analysis; Moreira, A., & Muir, T. (2017). Volatility-Managed Portfolios. Journal of Finance.
Citation only, paper link pending.

In plain terms

On days when a stock's price swings unusually hard intraday, the move tends to be an overreaction that partly reverses the next day.

How it works

A spike in realized intraday volatility (minute-bar rvol relative to its recent regime) flags forced flow and liquidity stress; the day's net move overshoots and partially reverses the next session. A calm-vol day carries no overshoot and is suppressed.

No live results for this strategy yet. Charts appear once it has earned a top spot on at least one stock, either on its own or as part of a blend of several strategies.
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Data dependencies

  • Intraday features daily

    A data feed this strategy reads, refreshed on its normal schedule.

  • Daily prices

    Adjusted-close OHLCV for every US-listed ticker; primary price feed.

Expected edge

An intraday realized-vol spike signals overshoot, so the day's move partially reverses the next session.

Related families

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For informational and educational purposes only. Not financial advice. Learn more