Volatility measures the magnitude of price changes in a financial asset, forming the basis for assessing operation risk.
The higher the market Volatility, the greater the short-term profitability, but the investment in that asset is considered riskier since, as with the profit, the loss can also be greater.
On the other hand, an asset with low Volatility represents a very low-risk investment.
As with Liquidity, Volatility is one of the factors that affects the Spread since an increase in risk (Volatility) will also increase the cost of my trade.
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