Glossary · Risk
Volatility
How much a fund’s returns vary around their average, usually stated as an annualised standard deviation.
Volatility measures dispersion, not direction. A fund that rises steadily and one that falls steadily can share a volatility figure.
Annualising volatility requires knowing the observation frequency: weekly observations scale differently from daily ones. A figure annualised on the wrong assumption can be materially wrong.
How we calculate it
Standard deviation of weekly returns × √52.