Investing is all about striking the right balance between risk and return. There are different types of risks in the stock market and there are ways to mitigate them. All investors naturally want to ...

Here at Investopedia, we emphasize the importance of prudent investing—put at stake only what you can afford to lose and ensure your choices align with your financial goals and risk tolerance. This ...

Learn what active risk is and how to calculate it. Understand the methods to evaluate active risk in portfolios and explore examples of funds outperforming benchmarks.

Investment risk refers to the potential for an investment to experience a loss or deviation from its expected return and can come from a variety of places. All investments carry some level of risk ...

Idiosyncratic risk is unique to specific investments like companies or industries. Systematic risk impacts all investments and is driven by macroeconomic factors. Mitigate idiosyncratic risk by ...

Forbes contributors publish independent expert analyses and insights. I write on AI, digital and cybersecurity governance and the board. Attackers are exploiting systemic weaknesses in digital ...

Investing is a balancing act between risk and reward, where the aim is to take on types of risks that offer proportional returns. In this game, not all risks are created equal — some come with the ...

Also called undiversifiable risk or market risk. A good example of a systematic risk is market risk. The degree to which the stock moves with the overall market is called the systematic risk and ...