market volatility

Market volatility refers to the degree of variation in the prices of assets like stocks or commodities over a specific period. It indicates how much prices fluctuate—higher volatility means prices change rapidly and unpredictably, while lower volatility suggests more stability. Factors influencing volatility include economic data, geopolitical events, and investor sentiment. Understanding volatility helps investors assess risk; more volatile markets can offer greater opportunities for profit but also carry increased risk of losses. Essentially, volatility reflects uncertainty and how quickly investor perceptions about value can shift in response to new information.