Investment risk checklist

When it comes to investing, there are a lot of risks involved. You could lose all of your investment, or you could make a fortune. There is no guaranteed way to make money in the stock market, so you need to be aware of the risks before you invest. Here is a checklist of things to consider before you invest in anything.

  • (1) Finally, you can measure risk by looking at the time horizon. The longer the time horizon, the higher the risk.

  • (2) The level of risk associated with an investment is measured by its volatility. The higher the volatility, the higher the risk.

  • (3) There are a number of ways to measure volatility, but the most common is the standard deviation of returns.

  • (4) The higher the standard deviation, the higher the risk.

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