What’s "Risk"?

When you’re talking about investing, there is risk that you could lose some or even all of your investment.

What’s "Return"?

It’s the income plus any gain in value of your investment from the time you buy to the time you sell, including earnings and profit (or loss) when you sell.

What’s the link between risk and return ?  The risk is the chance that you will lose some or all of your investment.  The return is the amount of money that you might gain on the investment.  Risk and return should be weighed carefully.  Know how much you can afford to lose before you take on investment risk.

Some types of investments have a higher risk than others. Investing money in different types of investments helps protect you against some of that risk. That’s a technique called diversification.

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