Market volatility describes the frequency and magnitude of price movements, up or down during a defined timeframe. The bigger and more frequent the price swings, the more volatile the market is said to be.
On average, the top 23 coins can swing 5% both ways.
Market volatility is measured by finding the standard deviation of price changes over a period of time. The statistical concept of a standard deviation allows you to see how much something differs from an average value.
What does a high volatility mean?
If the price of an asset fluctuates rapidly from the average in a short period, hitting new highs and lows, it is said to have high volatility.
Is volatility the same as risk?
Volatility is often used to describe risk. Risk involves the chances of experiencing a loss, while volatility describes how large and quickly prices move. If those fluctuating price movements also increase the chance of losses, then volatility can be said is equal to risk.
Reduce the full volatility with Libertify
Cutting the market volatility is core to what we do at Libertify. In the below you see how the Libertify graph is almost half as flat at the Buy & Hold (the market). The extent of the ups and downs are significantly less with Libertify, meaning the volatility has be cut, Otherwise said, your risks have been cut.
Personalized, Discipline, Risk Adjusting to Cut Volatility
When using Libertify, you significantly limit your exposure to the market risks. Libertify does this by intelligently and continuously adjusting your risk every trade. This means getting you in and out of the market before the asset reaches its highs and lows, thus avoiding the full swings, or volatility, of the market.
For every evident change in the market regime, Libertify will calculate in real-time the position size of your next trade, a formula based on your risk profile score and a suite of sophisticated trend following algorithms that read the market.