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Risk Management

Shari Mattingly Bevan- “Managing Risk”

February 24, 2011 | Filed Under Finance, Investment, Retirement Savings | Comments Off

Managing risk successfully in various areas of one’s life requires
knowledge, skill, and a little bit of luck. When evaluating any investment,
risk exposure is central to the determination you make. Typically, the
better the return, the higher the risk. Before, you can make the best
choice for you, you need to understand your own comfort level of risk.
Personal circumstances, preferences, personality, knowledge base, affect
one’s ability to handle different levels of risk.. When you are reviewing
your portfolio or considering a new investment, your primary thought should
be how much risk are you willing to bear, can you withstand the potential
loss, and then to consider what returns might you gain. Whether, your
neighbor invests in derivatives and has gained a small fortune, or you are
focused solely on a rate of return those should not be what drives your
investment decisions.
The goal of investing is better expressed as having enough cash on the day
a bill comes due.

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