According to modern portfolio theory, there is a trade-off between risk and return. All other factors being equal, if a particular investment incurs a higher risk of financial loss for prospective investors, those investors must be able to expect a higher return in order to be attracted to the higher risk. In the majority of cases, even though there is no promise of higher returns on risky assets, the higher risk just tends to scare off potential investors, keeping the returns on a given investment low. The only investments that can really try to promise higher returns for higher risk are bonds, and even then the higher returns won’t be generated if the issuing organization goes default.