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  1. Home
  2. /Glossary
  3. /Volatility
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trading

Volatility

How much an asset's price fluctuates over time.

Definition

How much an asset's price fluctuates over time. Crypto is famous for extreme volatility, with 10% daily moves being normal. Volatility creates opportunity for traders but risk for long-term holders who might panic sell.

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Related Terms

Speculation

Buying assets hoping to profit from price changes rather than fundamental value.

Accumulation Phase

A period when smart money quietly buys up an asset before a major price move.

Annualized Return

The average yearly return on an investment, calculated to account for compounding.

Arbitrage

Profiting from price differences of the same asset across different markets.

Ask Price

The lowest price a seller is willing to accept for an asset.

Automated Trading

Using software to execute trades based on predefined rules and algorithms without human intervention.

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