Share
Explore BrainMass

Rsk tolerance levels of investors

What are the risk tolerance levels of investors? What is your risk tolerance level?

Is it better to maximize return or minimize risk? Why?

What relationship exists between the size of standard deviation and the level of asset risk?

Solution Preview

What are the risk tolerance levels of investors? What is your risk tolerance level?

Risk is the probability of having losses. Here we should understand the risk return relationship. Risk return relationship is an important thing to understand for an investor. As per arnerichmassenaducation, "The more risk associated with an investment (the higher its short-term volatility), the higher its potential long-term return. "
Investor's expectations will be:
1) High return expectations with regard to a high risk investment
2) Lower return expectations with regard to a lower risk investment
As per stock market investor, some additional considerations should be made besides safety of the principal and the potential for growth. These considerations include the likelihood of achieving the financial goals you have established. Additionally, you should consider whether you are willing and able to accept a higher ...

Solution Summary

Response discusses the risk tolerance levels of investors

$2.19