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Volatile by sumopiggy - Version 2.jpg


French, from Latin volatilis, from volare to fly


  • 1: readily vaporizable at a relatively low temperature
  • 2: flying or having the power to fly
  • 3.a : lighthearted, lively
b : easily aroused <volatile suspicions>
c : tending to erupt into violence : explosive <a volatile temper>
  • 4.a : unable to hold the attention fixed because of an inherent lightness or fickleness of disposition
b : characterized by or subject to rapid or unexpected change <a volatile market>


In finance, volatility is a measure for variation of price of a financial instrument over time. Historic volatility is derived from time series of past market prices. An implied volatility is derived from the market price of a market traded derivative (in particular an option). The symbol σ is used for volatility, and corresponds to standard deviation, which should not be confused with the similarly named variance, which is instead the square, σ2. Much research has been devoted to modeling and forecasting the volatility of financial returns, and yet few theoretical models explain how volatility comes to exist in the first place.


The nature of growth is that on its cutting edge there is turmoil, for here newness exists as an experiential unknown. Once assimilated, it is then possible to know the relief of humor in reviewing what was once a great and fearsome struggle. - Daniel