Volatility (Standard Deviation of Returns)

A statistical measure of how much an asset's price moves around its average — usually expressed as annualised standard deviation of daily returns.

Volatility (Standard Deviation of Returns) — A statistical measure of how much an asset's price moves around its average — usually expressed as annualised standard deviation of daily returns.

Key facts

Category
Risk
Definition
A statistical measure of how much an asset's price moves around its average — usually expressed as annualised standard deviation of daily returns.
Formula
Annualised Volatility = Daily Std Dev × √252 (trading days per year)
Live example
/research/stock/VIX
Last updated
2026-06-17

Formula

Annualised Volatility = Daily Std Dev × √252 (trading days per year)

Interpretive bands

< 15%
Low-volatility. Utilities, blue-chip industrials, bond ETFs.
15 – 25%
Typical equity volatility for diversified large-caps.
25 – 40%
Higher-volatility. Growth tech, biotech, mid-caps.
> 40%
Very high. Single small-caps, leveraged ETFs, speculative names.

How IndexAlpha uses Volatility (Standard Deviation of Returns)

1-year and 3-year volatility on the Risk card. Plugged into VaR and Sharpe calculations as a key input.

See it live

The Volatility (Standard Deviation of Returns) metric shows up on every IndexAlpha research page. See it now on VIX — or research any stock to view its Volatility (Standard Deviation of Returns).

Related terms

Common questions

What is Volatility (Standard Deviation of Returns)?

A statistical measure of how much an asset's price moves around its average — usually expressed as annualised standard deviation of daily returns.

How is Volatility (Standard Deviation of Returns) calculated?

Annualised Volatility = Daily Std Dev × √252 (trading days per year)

How does IndexAlpha use Volatility (Standard Deviation of Returns)?

1-year and 3-year volatility on the Risk card. Plugged into VaR and Sharpe calculations as a key input.

Sources