Volatility
By Sitraka Forler · Lecturer, Durham Business SchoolUpdated 13 September 2026 About this site
Standard deviation of returns - a measure of risk.
Annualised volatility is the standard deviation of daily returns multiplied by √252 (trading days). Higher volatility means wider return swings. It is used in option pricing, risk budgeting, and portfolio construction.
Example
ann_vol = returns.std() * np.sqrt(252)