Stock Volatility

Stock volatility refers to the degree of variation in the price of a stock over a specific period. It is often measured by the standard deviation of returns, which quantifies how much the price of the stock deviates from its average price. High volatility indicates that a stock's price can fluctuate dramatically in a short period, suggesting a higher level of risk and uncertainty associated with the stock. Conversely, low volatility indicates that the stock's price tends to remain stable with smaller fluctuations, suggesting a lower level of risk. Investors often consider volatility when making trading decisions, as it can impact potential returns and the risk profile of their investment portfolio.