Standard deviation

The square root of the average squared deviation from the mean. It measures how spread out a set of numbers is.

Take the series 6, 8, 10, 12 and 14. Its mean is 10. Dividing the squared deviations by the number of observations, 5, gives the population standard deviation of 2.83; dividing by one less, 4, gives the sample standard deviation of 3.16, which is what Excel's STDEV.S and the pandas default return. You'll want the sample version when the numbers are a sample from a longer history, which in finance they almost always are.

In finance it's applied to returns, where its interpretation depends on a distributional assumption that markets don't satisfy. Under a normal distribution, a three-standard-deviation day should occur about once every few years, and markets deliver them far more often.

As a measure, standard deviation is fine. The assumption usually attached to it isn't.