The risk/return tradeoff could easily be called the “ability-to-sleep-at-night test.” While some people can handle the equivalent of financial 813530skydiving without batting an eye, others are terrified to climb the financial ladder without a secure harness. Deciding what amount of risk you can take while remaining comfortable with your investments is very important.

In the investing world, the dictionary definition of risk is the chance that an investment’s actual return will be different from expected. Technically, this is measured in statistics by standard deviation. Risk means you have the possibility of losing some or even all of our original investment.   Continue reading