"If you're going to pursue the biggest returns in the stock market you have to accept, by definition, the biggest volatility," he says.
More specifically, we observe low area volatility in big producers such as Brazil, China, India, USA, and the world aggregate, whereas we observe large volatility of corn and wheat in Argentina, wheat in Canada, corn in Mexico, and all crops in the Ukraine.
But these issues also are big on volatility.
But with day traders still scouring for big hits, volatility will remain a fact of life.
For a set of small returns (such as daily returns, as opposed to monthly or annual returns), the CAGR is approximately given by: CAGR = Mean - (1/2) VolaTheity2 The bigger the Volatility, the smaller the Annualized (CAGR) return.
However, he makes a big distinction between volatility and risk.
Some of this could be a result of the big jump in volatility recently among Nasdaq stocks.
With Asian nations still hungry for commodities, and company valuations low as a result of market volatility, big growth opportunities are said to be close at hand.
There were signs within the market, including widespread bearishness and a big increase in volatility, that a turning point was reached when stocks bottomed on Oct. 9.
Spelman said Britain fully supported calls for greater transparency on food stocks and reserves, but sounded more cautious than France on speculative activity being a big factor in volatility and high food prices.
