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Smart Analysis of Volatility Visualization as a Tool of Financial and Tourism Risk Management

In: Culture and Tourism in a Smart, Globalized, and Sustainable World

Author

Listed:
  • Ani Stoykova

    (South-West University “Neofit Rilski”)

  • Mariya Paskaleva

    (South-West University “Neofit Rilski”)

Abstract

Volatility is important for option traders because it affects options prices. Generally, higher volatility makes options more valuable, and vice versa. During periods of high volatility, financial markets are relatively more efficient. Volatility falls when markets rise and rise as markets fall. This paper focuses on examining the dynamics of European capital markets, S&P 500, GEPU, and VIX. Also, we observe the performance of S&P 500, Stoxx 600, and Stoxx Europe 600 Travel and Leisure price index. The analyzed period is 2003–2016. The results show that studied stock indices tend to move synchronously during the examined period. We register a high level of volatility for the period 2007–2011. The first major bottom of VIX is in December 2007. We can conclude that there is a strong correlation between VIX, GEPU, and S&P500 measuring “investor risk appetite”. GEPU fluctuates around consistently high levels since mid-2011 until the beginning of 2013. The dynamics of GEPU and VIX are not synchronized for the period 2013–2016. In the crisis period, travel and leisure stock performance lower because of increasing global uncertainty.

Suggested Citation

  • Ani Stoykova & Mariya Paskaleva, 2021. "Smart Analysis of Volatility Visualization as a Tool of Financial and Tourism Risk Management," Springer Proceedings in Business and Economics, in: Vicky Katsoni & Ciná van Zyl (ed.), Culture and Tourism in a Smart, Globalized, and Sustainable World, pages 359-370, Springer.
    • Handle: RePEc:spr:prbchp:978-3-030-72469-6_24
    DOI: 10.1007/978-3-030-72469-6_24
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    More about this item

    Keywords

    VIX; GEPU; Capital markets volatility; Financial crisis; Tourism industry;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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