Interest rate risk, tax risk, business risk, purchasing power risk are all types of risk.
But reasonably sophisticated investors can create the same product themselves by purchasing a risk-free zero-coupon Treasury bond and call options on a stock index, such as XSP options traded on the Chicago Board Options Exchange.
Current rates, however, do not come close to offsetting the purchasing-power risk that investors assume.
So long-bond buyers in today's market run the risk of purchasing something that is extremely likely to lose value while gaining nothing or next to nothing in yield pick-up.
Plain packaging will also exacerbate an already serious counterfeiting problem in parts of the EU. If unregulated, counterfeit cigarette packages are essentially indistinguishable from regulated products, consumers are at greater risk of purchasing dangerous products.
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Japanese securities firms claim that there is less risk in these issues than in purchasing, say, American Treasury bonds.
They wanted to find a way of monitoring those systems responsible for key business applications such as invoicing, payroll and purchasing, and identify which are most at risk of failure.
Investor cans bypass both company risk and commodities futures trading costs by purchasing U.S. Oil, an exchange-traded fund that tracks the price of oil futures.
Two issues that small investors often run into when looking at purchasing municipal bonds are how can they diversify their risk across multiple municipal bonds, and how can they afford to diversify the risk with large minimum investments required?
However, if you escape that risk by parking your assets exclusively in cash-like investments, you are likely exposing yourself to the possibility that inflation will silently erode the purchasing power of your portfolio, which can lead to the ultimate risk of not achieving your long-term goals.
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In the United States, the deep recession of 1918 damaged consumer purchasing power and convinced many to park their capital in tax free, risk free, bonds.
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One would expect that in purchasing or leasing land for resource extraction estimating the value of that land would introduce some risk.
The other risk for investors is that investors become fearful once again and flee stocks while purchasing safe havens, including the yen.
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