Mondo Visione  Nov 28  Comment 
Axioma, a leading provider of enterprise risk and portfolio management solutions, has entered into an agreement with Sycomore Asset Management, a leading French asset manager with €4.6 billion under management. Sycomore will deploy Axioma Risk,...
SeekingAlpha  7 hrs ago  Comment 
Forbes  Nov 26  Comment 
As the euphoria in the stock market continues to build with each new high in the major averages . In the short period since the election it seems that many have thrown caution to the wind with a few analysts using those most dangerous words...
Motley Fool  Nov 26  Comment 
The incoming president has mastered the social-media platform in a way that few have. Twitter should follow his lead.
Motley Fool  Nov 26  Comment 
Here are two stocks that could produce strong returns and still allow you to sleep at night.
New York Times  Nov 26  Comment 
Kelsey Koelzer of Princeton and Sarah Nurse of Wisconsin were both selected in June by teams in the National Women’s Hockey League. Koelzer was the first overall pick.
MedPage Today  Nov 25  Comment 
(MedPage Today) -- Hydrochloroquine, abatacept associated with reduced risk
newratings.com  Nov 25  Comment 
BRUSSELS (dpa-AFX) - The pound declined against its major counterparts in early European deals on Friday amid risk aversion, as oil prices declined on skepticism over an OPEC deal and banking stocks retreated ahead of upcoming Italian referendum...
The Australian  Nov 25  Comment 
Rio Tinto boss Jean-Sebastien Jacques says Australia should try to become the global financial centre for mining.
New York Times  Nov 24  Comment 
Heavier drinking, however, increased the risk of stroke.
SeekingAlpha  Nov 23  Comment 


Risk in economic terms indicates the probability of the occurance of a specific event, which would lead to damage or loss (p.e. the likelihood of losing ship and freight to a hurricane). In distinction to risk, chance indicates the possibility of a positive outcome.

Investments include both risk and chance. This is the so called Risk-Return Tradeoff: low levels of uncertainty offer low potential returns but also low potential losses, whereas high levels of uncertainty offer high potential returns but also high potential losses. Another way many investors quantify and calculate risk is in terms of the standard deviation of returns. This is because all else being equal, risk averse investors prefer returns that are less volatile and more predictable.

Companies try to identify, analyse and control risk through concepts of risk management.

Risks of Bond Investing

Bonds carry credit risk ("will I get my money back?"), prepayment risk, liquidity risk and interest-rate risk.

  • Many bonds give the bond issuer the right to repay the bond early -- which happens more often when rates are low, in other words, just when you don't want your money back. This is prepayment risk.
  • Liquidity risk is the risk that you won't find a good price for your bond when you want to sell it -- because there are so many more bond issuers than stock issuers, and because bonds are not exchange-traded, there may not be a willing buyer.
  • Interest-rate risk is the opposite of prepayment risk: when rates go up, the value of your bond will drop (it drops more, the further away it is from maturity). If your circumstances change and you need to sell the bond before maturity, you can lose capital that you would otherwise receive, if you held the bond to maturity.
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