Yes investments are risky; No matter how much investment experience you have it is always a risky business. If this is your first time investing you need to realize that all investing is risky. There is no such thing as risk free investing though certain types of investments certainly involve more risks than others. This is the main reason that it is so important to have a stock portfolio that is diversified enough to offer some insulation from losing due to one stock, fund, or bond performing poorly while others are doing extraordinarily well.
Diversifying your portfolio tempers the risks you are taking by investing carefully. “Never put all your eggs in one basket”. You want to diversify your investment portfolio so that one stock does not make you lose all your investments. You want to feel secure that your investments are secure to some degree despite the many risks you will face. You need a sense of security in order to continue investing and building your financial future. It is impossible to work on a financial future you do not believe in.
You need to have a few opportunities to take the risks that make the real money in the stock market game. You cannot accomplish this if all your monies are tied up in ventures that are safe. Sometimes we have to try the risky ones too.
There are all kinds of investments, different companies, different sectors, different types of stocks, bonds, funds, foreign exchange market, and others that each has different types of risks and a different type of security it depends on how you organize your investment portfolio. Make sure your portfolio has a mix of conservative and high risk investments to ensure profits.
By: Adma Dababneh
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