Risk and Return
BeginnerB-004
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Join →Risk and return are inseparable concepts in financial markets. Return is the gain or loss generated by an investment or trade, while risk describes the uncertainty surrounding possible outcomes. Higher potential return does not guarantee higher actual return; it may simply come with greater uncertainty or loss potential. As traders, we therefore evaluate opportunities not only by what we could gain, but also by what we could lose and how that loss would affect our capital.
Key Terms
- Risk and Return — the core concept introduced in this lesson.
