📈 Tutorial Cluster

Volatility 75 Index — Trading Guide With AI Bots

By Dan Machado · 9 min read

Volatility 75 Index (V75) is Deriv’s flagship synthetic asset and the most popular instrument for retail AI bot trading. It runs 24/7, ignores news, has predictable volatility, and accepts minimum stake of $0.35 (R6.50). Understanding V75 properly is essential before deploying any automated strategy on Deriv.

75%

Annual Vol

24/7

Trading

$0.35

Min Stake

Tick Speed

What Is Volatility 75 Index?

V75 is a synthetic instrument — meaning it’s not based on real-world prices. It’s a mathematically-generated price series with these characteristics:

Algorithm-driven: price changes generated by cryptographically-secure RNG
75% volatility constant: annualised standard deviation is fixed
Independent of markets: no correlation to forex, stocks, crypto
News-immune: Fed announcements, SARB decisions, geopolitics — zero effect
Audited fairness: verified by Verified.io and BMM Testlabs (third-party labs)
24/7 availability: never closes, no gaps, no weekends

Why V75 Is Ideal for Retail Bots

✓ Five Key Advantages

1. Predictability: 75% volatility constant means strategies behave consistently across periods
2. No news risk: your bot won’t get blown up by surprise Fed decisions
3. 24/7 trading: your bot can run while you sleep (especially valuable for SA timezone — fires when EU/US sleep)
4. Low barriers: $0.35 minimum stake means small accounts (R500+) can test real strategies
5. High liquidity: no slippage, instant execution, perfect for bot logic

V75 vs Other Volatility Indices

Asset	Vol %	Best For
Volatility 10 Index	10%	Conservative, slow trends
Volatility 25 Index	25%	Light volatility strategies
Volatility 50 Index	50%	Moderate, balanced
Volatility 75 Index ★	75%	Most popular — sweet spot for bots
Volatility 100 Index	100%	Aggressive scalping
Volatility 150 Index	150%	High risk, high reward
Volatility 250 Index	250%	Experimental — rapid moves

V75 is the most popular because it’s high enough volatility for frequent signals but not so extreme that risk becomes unmanageable. Start with V75 before experimenting with V100+.

Top Strategies for V75

1. RSI Mean Reversion (Most Common)

The classic strategy that works because V75 oscillates around a mean. BUY when RSI < 30, SELL when RSI > 70. Our 30-day test shows 70% win rate on this. Full tutorial: Deriv Bot Setup.

2. RSI + EMA Crossover Filter

Reduces false signals by 30-40%. BUY only if RSI < 30 AND EMA(9) > EMA(21). This adds trend confirmation to the mean-reversion logic. Quality over quantity.

3. Bollinger Bands Squeeze Breakout

When BB width contracts below 20-period average, expect breakout. BUY on upper band break, SELL on lower band break. Works well during V75’s range-bound phases (which happen 60% of the time).

4. Higher Highs / Lower Lows (HH/LL)

Pure price action. Detect 3 consecutive HH = uptrend (BUY pullbacks), 3 consecutive LL = downtrend (SELL bounces). Simple but effective for trend-following on V75.

5. VWAP Pullback

Volume Weighted Average Price calculated session-by-session. BUY when price pulls back to VWAP from above (in uptrend). Less popular but consistent on V75.

Strategies to AVOID on V75

❌ Don’t Do These

1. Pure Martingale — V75’s high volatility means losing streaks of 5+ are common, double-after-loss kills accounts fast. See why it fails
2. Fixed pip stop-loss — V75 moves too fast, fixed stops get hit constantly. Use ATR-based stops
3. News-event strategies — V75 ignores news, these strategies have zero edge
4. Carry trade logic — synthetic, no interest rate differential exists
5. Pattern-based strategies (head-and-shoulders etc.) — patterns from real markets don’t transfer to RNG-based synthetics

Position Sizing for V75

Standard rules apply, but V75’s high volatility demands extra caution:

Stake per trade: 2% maximum (1% safer for beginners)
Daily loss limit: 5% of starting balance
Max consecutive losses: 3 (then 60-min cooldown)
Max trades per day: 8 (quality over quantity)
Trade duration: 3-10 ticks (longer = more variance)

Example ZAR amounts at ~R18.50/USD:

R1,000 capital → R20 max per trade (2%)
R5,000 capital → R100 max per trade
R10,000 capital → R200 max per trade
R50,000 capital → R1,000 max per trade

Best Time of Day to Trade V75

🕐 Honest Answer: Doesn’t Matter Much

V75 is synthetic — its behaviour doesn’t follow market hours. But there are minor patterns from server load:
• Slightly more volatile during peak hours (EU/US overlap, SAST 14:00-22:00)
• Slightly calmer overnight (SAST 02:00-08:00)
• Quality of execution is constant — no slippage difference
Many bots run 24/7 with no time filter and perform fine. If you want a filter, use SAST 09:00-23:00.

Common Misconceptions

❓ “V75 follows the VIX Index”

FALSE. The name is similar but V75 has zero correlation with CBOE Volatility Index (VIX). VIX measures S&P 500 implied volatility. V75 is a synthetic with constant 75% volatility regardless of any real-world index.

❓ “V75 is rigged against me”

FALSE. V75’s RNG is audited annually by independent labs (Verified.io, BMM Testlabs). Reports public. The house edge is in payouts (you get 85-95% on win, lose 100% on loss), not in price manipulation. Same edge any binary options product has.

❓ “I can predict V75 with technical analysis”

PARTIALLY TRUE. Technical patterns DO emerge in V75 because RSI, EMA, etc. respond to price regardless of price source. But “trend continuation” assumptions from real markets may not hold — V75 reverts faster than forex/stocks.

Trading V75 Tax in South Africa

📋 SARS Treatment

V75 profits are taxable income in SA. Same treatment as other derivative trading:
• Frequent trading (more than 4 trades/day average) → income tax at marginal rate
• Occasional → capital gains tax (~18% effective)
Download annual statements from Deriv. Keep CSV of all trades. Consult SARS-registered tax practitioner. Read our full disclaimer.

Demo Before Live

Always test V75 strategies on demo for 30+ days minimum. Why:

V75 has different micro-behaviour than other markets
Your strategy may work on EUR/USD but fail on V75
30 days = ~600 ticks, enough for statistical significance
Catches regime changes (calm vs volatile phases)
Builds emotional discipline before real money

🚀 Test V75 strategies on Deriv demo ($10,000 virtual, FSCA-licensed):

Open Free Deriv Demo