Understanding and dealing with risk

There’s a cold, hard truth that anyone looking to invest money to reap profits needs to face – all investments involve some degree of risk. In the financial world, the term risk refers to the degree of uncertainty and potential financial loss inherent in any investment decision.  

In general, there is also one hard and fast rule – as investment risks rise, investors seek higher returns to compensate themselves for taking such risks. So the more you stand to gain, the higher your chances are of losing.

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