Whether you’re a frequent trader, an occasional trader or even just a buy-and-hold investor, you’ve probably noticed that 2010 has been a very volatile year for the equity markets.  In fact, 2010 could easily be tagged with moniker, “year of volatility,” as there has been scores of days with big buying — and scores of days with big selling.

If we look at the chart here of the S&P 500 Index, we can see just how volatile a year it’s been for stocks.  We started the year at 1,133 on the SPX, and as of the close on Nov. 22, SPX closed at 1,197.84.  That’s a gain of 5.72%, not bad, but not stellar when compared to the market’s better years.  However, the road to this gain has been anything but smooth. 

As you can see, there was a sharp dive in stocks in January and February.  That dive was followed by a big buying surge from mid-February to late-April.  Then we saw stocks tank once again, plunging from April to early July and landing at a new 52-week low of just over 1,022. 

Stocks then rallied again until early August, only to once again see the selling resume.  The selling continued throughout that month, and then in late-August buyers really stepped in, taking stocks on a two-and-a-half-month run to a new 52-week high in the wake of the midterm election and the Fed’s announcement of QE2.  Since hitting that high in early November, stocks have pulled back off those highs, although they remain trading above both the short-term, 50-day moving average as well as the long-term, 200-day moving average.

The table below shows the five biggest one-day percentage losses on the S&P 500 so far this year, and the biggest one-day percentage gains on the index so far in 2010.

As you can see, there’s been some very big down days this year, as well as some very big one-day buying sprees.  These kinds of big days in both directions are part of what make 2010 the year of volatility.

Now, the same volatile tale can be told in the Dow Jones Industrial Average, as can be seen by the chart here of the market’s most well-known indicator.  The Dow is up 5.62% through Nov. 22, but like the wider market measure, the S&P 500, the road to that gain has been anything but smooth.

The table below shows the five biggest one-day percentage losses on the Dow Jones Industrial Average so far this year, along with the biggest one-day percentage gains on the index in 2010.

If the first 11 months are any harbinger of things to come, December will likely also see more than its fair share of volatility too.  So whether you’re a day trader, occasionally make a trade, or just sit and watch your investments fluctuate from the sidelines, it’s probably wise to get prepared for a likely flurry of activity when Santa comes to town next month.