The Risk/Return Trade-Off
"Risk is a defining factor of successful investing
because the more risk you take, the more likely the returns
on your investments will be superlative."
- Ilyce R. Glink, author of
100 Questions You Should Ask About Your Personal Finances
You'll discover that investments with the greatest return
potential carry the greatest amount of risk. Likewise, investments
with conservative returns are generally the least risky. The
key is to strike a balance between your financial objectives
and your ability to tolerate market risk.
Generally, this entails diversifying your money across a
combination of low, medium, and high-risk investments to strike
an overall balance with the potential to meet your long-term
goals--while allowing you to sleep at night.
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