Meaning of volatility cluster | Babel Free

Definitions

The occurrence of a great swing in an index being nonrandomly adjacent to others.

countable, uncountable

Examples

“Figure⟳ 3 shows the volatility clustering for oil, gold, and the five developing bond market return⟳ series in the period between 2008 and 2022. Regarding the magnitude of volatility clustering, China, India, Russia, and especially oil, appear⟳ more volatile than other markets and volatility clusters occurred around 2008-2010 because of worldwide economic instability. The reason⟳ for the volatility clusterings in 2008-2009 in Figure⟳ 3, was the crisis precipitated by the collapse of subprime mortgages in the U.S. in 2008.”

CEFR level