Now available to order from Pellucid is the Share price over time with future uncertainty fan chart. This chart provides context around where the share price of a subject company can be expected to go in the near term and any associated uncertainty.
This variant of a share price chart supplements historical data with a forward-looking perspective about share price expectations for a subject company. The actual historical share price is shown using a line plot while the theoretical future distributions of potential share price are shown using an “uncertainty fan”. The expected price 12 months out is determined by analyst target prices, while any percentile outcome is calculated by applying historical realized volatility to an assumed lognormal distribution around this expectation. The legend on the right maps the color density inside the fan to a range of percentiles encapsulating the 90% most likely share price outcomes at any point in time.
Read more about how to use the share price fan chart at Fix The Pitch.