Volatility and risk are often used interchangeably when it comes to stocks, but a risk is something that could happen, whereas volatility is something that will happen. Volatility is not a risk itself, but merely presents the risk that the market will be down when you need to sell your stocks. If a portfolio can go untouched, volatility quickly transforms from risk to opportunity. Price fluctuation of stocks is one of the reasons that the long-term expected return is required to be higher; because rational investors would always choose the lower volatility investment given the same expected return, all else being equal. This blog post at A Wealth of Common Sense discusses more reasons not to fear volatility in Volatility is not Your Enemy.