Meaning & Definition of word "Volatility"
Volatility
/ˌvɒl.əˈtɪl.ə.ti/
noun:
- 1. The quality or state of being prone to rapid and unpredictable changes, especially in financial markets.
- Example: The volatility of the stock market can lead to significant gains or losses for investors.
- 2. The degree to which a substance can vaporize or change into a gas.
- Example: The volatility of the chemical compound makes it necessary to handle it with care in a controlled environment.
- 3. The tendency of prices to fluctuate over time.
- Example: High volatility in oil prices can affect global economic stability.
- 4. In finance, a statistical measure of the dispersion of returns for a given security or market index.
- Example: Investors often look at the volatility of a stock as an indicator of its risk.
Etymology
●Late Middle English: from late Latin volatilitas, from Latin volatilis 'flying', from volare 'to fly'.
Common Phrases and Expressions
market volatility:
The tendency for market prices to fluctuate.
volatility index:
A measure of market risk and investors' expectations of volatility.
high volatility:
A situation where an asset's price experiences large swings.
volatile market:
A market characterized by rapid and unpredictable changes in price.
Related Words
instability:
The quality of being prone to change or unpredictable behavior.
fluctuation:
An irregular rising and falling in number or amount; a variation.
risk:
The possibility of loss or injury.
Slang Meanings of volatility
Meaning: Wild swings in stock prices.
● Example Sentence: That stock is crazy; it's got some serious volatility right now!
Meaning: A risky investment due to price fluctuations.
● Example Sentence: Investing in crypto is high volatility, man, tread carefully.