Bots & Strategies5 min readUpdated September 2026

What Are Synthetic Indices on Deriv and How Do They Work (Volatility 10 to 100)

Explore the cryptographic random number generator (RNG) mathematics behind market simulation.

Dr. Leonardo Guimarães

Head of Quantitative Research & Algo Trading • E-E-A-T Verified

Audited for 2026

Executive Summary & Practical Insights

Synthetic indices simulate genuine market price action using audited cryptographic algorithms, remaining immune to macroeconomic events, bank holidays, and geopolitical shocks.

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1. The Mathematics of Synthetic Price Feeds

Synthetic indices utilize high-frequency cryptographic generators to simulate bullish, bearish, and ranging cycles with statistical consistency. Each tick reflects pure probabilistic dispersion.

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2. Major Synthetic Asset Classes

- Volatility 10 to 100: Pre-calibrated volatility tiers (Volatility 10 has smooth 10% annual volatility, whereas Volatility 100 swings at 100%). - (1s) Indices: Ticks generate every exact 1 second for ultra-fast scalping. - Jump Indices: Controlled sudden price jumps for breakout strategies. - Crash/Boom: Distinct trending phases interrupted by statistical spikes.

3. Why Automated Bots Excel on Synthetics

Because price action is purely statistical and free from emotional retail herd behavior or news leakages, quantitative algorithms can execute precise mathematical models with reliable edge.

Frequently Asked Questions (FAQ)

Do macroeconomic news events affect synthetic indices?

No. Unlike Forex or equities, synthetic indices have fixed mathematical volatility unaffected by central bank rate announcements or inflation data.

Can the broker manipulate synthetic index prices?

No. Pricing is derived from cryptographically secure pseudorandom algorithms audited independently by third-party statistical verification labs.

Can I trade synthetic indices on weekends and holidays?

Yes! Synthetic markets operate 24 hours a day, 7 days a week, 365 days a year without downtime.

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