What are the Risks Associated With Investing Part - 2 - InvestNagar

Investing, It is terrible for many people due to the big fear of losing their savings. The Stock Market, Very famous for its volatility, often discourage potential Investors with the warnings of potential losses. The Mainly Risks Associated With Investing in stocks are: 

Part - 1 - InvestNagar.com

What are the Risks Associated With Investing - InvestNagar


NO. 1  - No Guaranteed Returns:

When people like you and me invest in stocks it comes with the perceptive that there is No Guaranteed Returns. Despite that Stocks generally shows positive long-term pursuance, there is no certainty of making profits at any definite moment. While there are various factors that can benefit in studying a particular stock, it is kind of impossible to accurately predict its proper future performance. There is no assurance that the price will increase or the stock will give dividend payouts, or the company will stay in the long term in the market.

NO. 2  - Volatility:

What You mean by Volatility? Volatility is the short-term changes in any stock's prices. Generally The Stocks with higher volatility faces faster and powerful price fluctuations, which indicate us higher risk, whereas those stocks with stable movements are considered as lower risk. If any kind of specific events occurs, it increases the volatility in stocks. It is also important to note down that while volatility sometimes indicates us the speed of price changes, it doesn't show us the direction of it, that means volatility can be high anytime during upward or downward movements.

NO. 3  - Timing:

There is a very famous line in the stock market, that "Time = Money"
Time which is the principle when prices fluctuate constantly. Deciding that the Proper Perfect moment to buy or sell a stock is always a challenge for both professionals and individual investors like us. While our aim is always to buy at the low prices and sell at high prices, But Predicting the exact perfect future trends is likely impossible. For Example, when we purchase stocks among Confidence only to face a sudden market crash or sell in a panic situation before a Bounce which give result in significant losses. Imperfectly planned investments can be financially destructive.

PART - 3

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