Glossary · Markets & Trading Mechanics

Volatility

How much and how quickly an asset's price moves.

Volatility measures the size and speed of price swings. A volatile asset can rise or fall sharply in a short time; a less volatile asset usually moves in smaller steps.

Higher volatility means wider possible outcomes — larger gains and larger losses. Beginners often feel volatility emotionally; risk tools (position size, stop levels, diversification) exist partly to keep those swings manageable relative to your account.

Example

A slow-moving utility stock that drifts 1% a week is less volatile than a small tech name that can jump or drop 8% in a single session.