Financial market volatility is defined as the rate at which the price of an asset rises, or falls, given a particular set of returns.
Investors can use this data on long term stock market volatility to align their portfolios with the associated expected returns.
Formula to calculate daily volatility.
![Calculate Daily Volatility.](https://www.learntocalculate.com/wp-content/uploads/2020/08/daily-volatilty.png)
Variance in this case, is the variance of the stock price.
Example:
Suppose you calculated the stock price variance and found it to be 625. Calculate the daily volatility.
![Calculate Daily Volatility.](https://www.learntocalculate.com/wp-content/uploads/2020/08/daily-volatilty-2.png)
Therefore, the daily volatility is 25.