The basics
Volatility
Volatility measures how much and how fast an asset's price moves. The higher it is, the faster the price swings.
Volatility measures how much and how fast an asset's price moves. The higher it is, the faster the price swings.
Volatility describes how sharply a price jumps one way or the other. A highly volatile asset can gain or lose a lot in a short time; a low-volatility asset moves slowly. It says nothing about direction, only about the size of the swings.
For a trader, volatility cuts both ways: it creates opportunities but raises risk. The more volatile an asset, the more carefully the stop-loss and position size must be set.
A calm stock moves 1% a day. On earnings day it swings 12% in minutes: its volatility has exploded, and the risk with it.
Understanding a term is good. Applying it on a real platform with a clear method is better. That is exactly what we do in 5 days.