Volatility (monthly)
Shows how much monthly return usually jumps around its average.
Monthly volatility shows how uneven the months were. Two accounts may deliver similar return, but one moves almost steadily while the other alternates between strong gains and losses.
The metric helps judge the comfort of the path. With the same return, lower volatility usually means a more predictable monthly series, while high volatility means the result came in bursts.
A low value does not guarantee safety, and a high value does not automatically mean loss: volatility counts both good and bad surprises. 2-5% per month often looks moderate, while 10%+ points to a noticeably jumpy monthly series. With short history, the number can move a lot.
Example: the account's average monthly return is +1% and monthly volatility is 3%. In that kind of history, many months usually sat near roughly -2% to +4%. With 12% volatility, normal monthly swings can already look like -11% or +13%.
How we compute it
We use the sample standard deviation of monthly TWR returns. Those returns are built on a unified basis that accounts for deposits and withdrawals, so money movements do not inflate the dispersion.