Why Traders Love Volatility Except When It Bites Back: QuickTake
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Mom and pop investors fear it. Traders by and large love it, and normally miss it when it’s gone. Volatility was absent from the financial markets for an unusually long time before rushing back. It’s now on everyone’s radar screen, and likely to stay that way in the months ahead. Volatility not only affects investments; investing in volatility has become something of a cottage industry.
Basically, the up-and-down movement of the market. Downward moves tend to get more attention and be more associated with volatility, as they also tend to fuel concern about what’s coming next.