Each investment involves various risks. Many people fear to take risks and live in the same situation without any change. Returns are the outcome of taking calculated risks.Higher the risk,higher will be the returns.
Risk is the possibility of loss occurrence in an investment. We cannot predict any thing in the future.Human life and physical health is also unpredictable.How we will calculate the risk?It is mainly by the price history,growth potential and fundamentals of the assets.
Calculated risk avoid the unexpected vulnerabilities.Some major risks are changes in policy measures of the nation, falling value of currency,changes in interest rates,war, fluctuations in supply and demand,inherent risk in an asset etc.Calculated risk is entirely different from gambling and speculation. It analyse the real value and potential gain of investments with various parameters.It is much superior than short term investment tactics.
Creating financial corpus is very important for achieving your life goals.Financial goals differ from person to person.Financial freedom depend upon your knowledge and skills in identification of real value assets.
Investing in appreciating assets will create enormous value after the time horizon. But,investor should take the risk and responsibility.He should identify the opportunities and pitfalls.Let us examine the hidden secrets of value investing.