Glossary entry
Investment risk is the possibility that actual outcomes differ from expectations, including losing capital or failing to meet a financial goal. Relevant risks include price movements, inflation, default, liquidity, currency changes, and operational problems. Risk assessment considers both likelihood and severity, together with the investor's time horizon and ability to absorb losses.
Illustrative example
An investment may preserve its nominal value while rising prices reduce what the money can buy. That outcome illustrates inflation risk rather than a price loss.
What to consider
No single statistic captures every risk. Consider adverse scenarios and personal cash needs alongside historical returns and volatility measures.
General information, not a personal recommendation. Product availability, rights, and obligations are determined by the relevant provider, jurisdiction, and approved agreements.