In general, this risk is greatest with those investment alternatives with a set, guaranteed rate of return. So while CD's have a low investment risk, they have a high purchasing power risk. In a new account agreement, you must specify your overall investment objective in terms of risk. Be careful you understand the distinctions between these terms, and be certain that the risk level you choose accurately reflects your investment goals. Be sure that the investment products recommended to you reflect the category of risk you have selected.
Nobody invests to lose money.
However, investments always entail some degree of risk. 2.Some investments cannot easily be sold or converted to cash. Check to see if there is any penalty or charge if you must sell an investment quickly or before its maturity date. 3.Investments in securities issued by a company with little or no operating history or published information may involve greater risk. 4.Securities investments, including mutual funds, are NOT federally insured against a loss in market value.