Volatility
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Join →Volatility describes the magnitude and variability of price movements over time. High volatility means prices can move substantially and rapidly, while low volatility generally indicates smaller and more stable price changes. Volatility creates opportunity, but it also changes risk. A stop distance, position size, and expected range that may be reasonable in a calm market can be inappropriate in a highly volatile market. We will later use volatility as a measurable component of risk management and strategy selection.
Key Terms
- Volatility — the core concept introduced in this lesson.