What Is Risk?


Jake Morr


August 25, 2023

Risk, in finance, refers to the uncertainty of an investment's return and the chance of losing some or all of the original investment. Investors typically seek higher returns as compensation for greater risks. Different investments come with varied risks and returns, influenced by factors like a company's stability, market volatility, inflation rates, interest rate changes, and liquidity constraints. Proper risk management helps mitigate potential losses.

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