August 2011 was one of the most volatile months on record, in which the US stock market fell from 12,292 on 1 August to 10,444 on 9 August – a retreat of over 15.0% in five trading days.
DOW JONES
Volatility in August (measured by the VIX index) also surged from 25.00% to 40.00%, following contagion fears in Europe, US credit rating downgrade and a slowing Chinese economy.
Traders, global fund managers and institutions watched in horror as their positions were liquidated and stop losses were triggered. The volatility of equity markets hemorrhaged wealth from investors who were willing to hold. Gains made in shares can be quickly eroded and "getting back" those gains could take longer than you desire.
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