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252 or 365 for de-annualizing IV?
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Asking whether to use 252 trading days or 365 calendar days to de-annualize implied volatility in Black-Scholes models.
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I'd like to experiment with expected vs actualized moves, the problem is I don't know if I should use 252 or 365 to de-annualize IV? The formula I'm planning on using is IV \* sqrt(t/(252 or 365)), I'll be pulling the IV data from thinkorswim. I'm getting conflicting answers online if Black Scholes and its variants use 252 or 365 days for a year aka trading days or calendar days. DTE is usually by calendar days, but thinkorswim sorts their data by trading days. What should I do?
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