The meaning of fluctuation is the act and consequences of fluctuating. Specifically, this verb refers to the oscillation of values, either increasing or decreasing alternately. The concept fluctuation has different meanings.
In the field of finance, it refers to the monetary loss that arises from the decrease in a specific quantity of merchandise or due to the updating of the stock. Collect the difference between what the inventory books show and the actual existence of the goods.
The loss will be the specific and material loss of the items, while the fluctuation is associated with the monetary loss as a result of said variation. The fluctuation aims to show in money the difference between what there is and what should be had according to what is collected in the inventories.
A fluctuation develops when its measurement results in a permanent evolution, both downward and upward, and always with a certain instability. These changes generally take place due to external situations or as a result of the action of supply and demand.
Economic fluctuations lead to a series of gains and losses for the members of the economic map, led by constant changes in the price or value of goods, services or merchandise.
Types of fluctuation
It is necessary to differentiate between two kinds of fluctuations:
- Regular or cyclical fluctuation: refers to different periods of growth or decrease that occur over time, respecting a pattern.
- Irregular fluctuation: it does not obey foreseeable changes, and they occur due to different external effects.
The changes in the Forex market They are also called as fluctuations. In this sense, the term fluctuations allows to name the changes in the value of one currency in relation to another. This fluctuation will depend on central banks, political actions and the situation of international trade.