The riskiest part of a Roth IRA is choosing the investments. Once you select your investments, the only thing that can affect your investment risk simply by changing is how much money you invest. You can diversify away single-stock portfolio risk and manage allocation and sector risks to reduce any worries about how these factors will impact individual stocks in a diverse portfolio. This also helps stabilize the value of assets held in such a portfolio, thus reducing volatility, which translates into less potential for extreme losses or gains that could erode an investor's wealth. However, if invested wisely, this investment will produce higher returns annually than traditional portfolios with lower annual volatility