![]() ![]() Standard deviation is a measurement of investment volatility and is often simply referred to as “volatility”. Is standard deviation same as volatility? What exactly is standard deviation?Ī standard deviation (or σ) is a measure of how dispersed the data is in relation to the mean.A standard deviation close to zero indicates that data points are close to the mean, whereas a high or low standard deviation indicates data points are respectively above or below the mean. This represents the S&P 500’s daily volatility for August 2015. In this example, our daily standard deviation is 1.73%. In Excel, the formula for standard deviation is =STDVA(), and we will use the values in the percentage daily change column of our spreadsheet. How do I calculate standard deviation in Excel?
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