Volatility

Volatility measures the dispersion of an asset’s returns around its mean, usually quoted as an annualized standard deviation. Investors use the word as a synonym for risk. It is closer to a fare: what you pay in swings for equity-like returns, and what tests your discipline while you hold them. No fixed number makes an asset “volatile.” The word is relative to the asset’s own history and to the regime it trades in, which is why the comparison worth making is current realized volatility against its own long-run level rather than against some threshold somebody published.