What volatility tells you
Volatility is the most common measure of how risky a fund feels month to month. A fund averaging 12% a year with 8% volatility moves in a tighter band than one averaging 12% with 20% volatility — even though their average return is identical.
How to read it
- Equity funds are naturally more volatile than debt; compare like with like.
- High volatility isn't automatically bad if you have a long horizon and a strong stomach — but it widens the range of what you might experience, especially over short periods.
- Volatility feeds into the Sharpe and Sortino ratios, which judge whether the return was worth the bumpiness.
How FindMF computes it
We resample each fund's NAV (from AMFI daily data) to month-end closes and take monthly returns over completed months only — the current partial month is excluded. Volatility is the standard deviation of those monthly returns, annualised by multiplying by sqrt(12) and expressed as a percentage. At least 12 months are required, or the metric is suppressed. Details on methodology.