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Risk and volatility

How much can this move, and what does the number mean?

How much can this move, and what does the number mean?

Video coming soon

In this lesson

  1. Volatility measures how far your returns swing around their average. A higher number means a bumpier ride. The result at the end can still be good.
  2. The heatmap shows each month as a cell. Green months went up, red months went down, and the darker the cell, the bigger the move. From that you can form a hunch and check it with the period at the top.
  3. The heatmap's percentages and the euros under “Returns by Month” measure different things. The percentages show how the value of the whole portfolio moved, even if you sold nothing. The euros only count dividends, interest, option premiums and gains or losses from sales, in the month they were booked.
  4. Volatility looks backwards. It describes how much the portfolio has moved. A calm year says little about the next crash.

The example: 2024 and 2025 side by side

Two red months stand out in the heatmap. In March and April 2025 the portfolio lost 7.7 and 5.3 percent, and the stock market fell in those months too. February 2026 shows minus 4 percent. A few months like these drive up the volatility.

In 2024 the cells are mostly light, with months between minus 2.4 and plus 6.4 percent. In 2025 they are much darker, from minus 7.7 to plus 7.0 percent. So you expect the portfolio to have moved more in 2025. You choose 2024 in the period at the top and see a volatility of 13.8 percent. For 2025 it is 17.7 percent, and the number confirms the heatmap.

In March 2025 the portfolio fell 7.7 percent. Under “Returns by Month” it still shows 37 euros, because the dividends kept coming in. In September 2025 the portfolio rose 1.8 percent, and the bottom table shows minus 596 euros, because Zoetis was sold at a loss that month. The top table had already shown that price loss in the months before.

Sample account, not real data, not investment advice.

Where to find it in Rendity

On the Performance page you find the volatility card. Further down come the “Monthly returns (TTWROR)” heatmap and, right below it, the “Returns by Month” table. You choose the period at the top of the page.

Included inSprout Tree Orchard

Terms from this lesson

Next lesson Comparing yourself to the market

Education only, not investment advice. Tax topics are not tax advice.