sentences:  These estimates assume a normal distribution; in reality stocks are found to be leptokurtotic.Although the Black-Scholes equation assumes predictable constant volatility, this is not observed in real markets, and amongst the models are Emanuel Derman and Iraj Kani's and Bruno Dupire's local volatility, Poisson process where volatility jumps to new levels with a predictable frequency, and the increasingly popular Heston model of stochastic volatility.It is common knowledge that types of assets experience periods of high and low volatility.