Volatility

Volatility describes how much and how fast the price of a Pokémon card swings over time. A card with low volatility has steady prices, while a card with high volatility can rise or fall sharply in a short time. The term says something about the size of the swings, not about their direction.

What affects the swings

Several factors make some cards more volatile than others:

• Few trades. When a card rarely sells, a single sale can move the figure a lot. See liquidity.
• Attention. News, videos, new games, anniversaries and social media can cause short-lived jumps, see hype and price bubbles.
• New supply. New printings and large product releases can increase the number of cards in the market, see reprint risk.
• Auction outcomes. Auction sales can end unusually high or low, since the final price depends on who bids.
• Currency. Exchange rate movements shift the price in kroner even if the card's price in foreign currency is unchanged, see currency.

How it is measured and seen

In finance, statistical measures such as standard deviation are used to measure volatility. Among card collectors it is more often read directly from a chart: large swings between points mean high volatility, a smooth line means low. It is easiest to see in price history, but card data is often thin, so measures based on few points are uncertain.

Volatility is not the same across all parts of the market. Modern cards soon after release can change price quickly as supply grows. Older, established cards often move more smoothly, but can also have few trades and large jumps between them. Graded copies in high grades can be especially prone to jumps when individual cards change hands.

What volatility does not say

• It does not say whether the price will rise or fall.
• High volatility is not the same as high risk or high return, and low volatility is no guarantee of stability going forward.
• It says nothing about a card's quality or scarcity.

Relating to swings

Anyone who follows prices sees that swings are part of the market. It is therefore common to look at longer periods, several sources and the number of trades behind a figure before interpreting a change. See also market price for how the figures are calculated. This entry explains the term and gives no assessment of individual cards.