Volatility: The Enemy of Long Term Retirement Planning.
"Volatility" refers to the propensity of a stock or index's market growth rate to diverge up or down from its average growth rate over time. Assume for discussion that the SP 500 has an average growth rate of 10% with a standard deviation of 15%. Standard deviation is a principally a portfolio measurement; it is both added and subtracted from the 10% average return to determine a likely outcome range. In this example, an investor can anticipate performance ranging in any s