Annualized volatility

Description

In finance, volatility is a measure for variation of price of a financial instrument over time. return is a profit on an investment. It comprises any change in value, and interest or dividends or other such cash flows which the investor receives from the investment.
If the daily logarithmic returns of a stock have a standard deviation of σSD and the time period of returns is P, the annualized volatility can be calculated by the values of σSD and P.

Related formulas

Variables

σAnnualized volatility (dimensionless)
σSDStandard deviation of the daily logarithmic returns of the stock (dimensionless)
PTime period of returns (dimensionless)