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To understand risk tolerance and risk capacity, we must first defines investment risk: It’s simply the probability that an investment will deviatea from expectations. Some of the kinds of risk factors your portfolio may face: Market Risk: Comes from simply entering the marketplace. It’s broad risk that affects all sectors, and youa can’t diversify it away. Event Risk: Results from a sudden incident — say, a major change in an industry or a natural disaster that affects equities in a certain sector. Volatility Risk: Fuels the ups and downs of the market roller coaster. Investors tend to think of the plunges when they hear “volatility,” but upswings also cause deviations from expected performance and demand attention. Concentration Risk: Happens when a portfolio focuses too heavily on one sector, industry or geographic region. Leverage Risk: Magnifies potential gains and losses, through hedge funds with built-in leverage or by borrowing to increase leverage. Liquidity Risk: Results from how fast investors can access the cash locked up in investments. Operational Risk: Applies to specific stocks, from internal productiona problems to supply chain snafus. How these various kinds of risk interact within your portfolio helps determine its overall level of risk. Don’t confuse the investment risk your portfolio has with your own personal tolerance for risk or with your own capacity to take on risk to reap potential rewards. Just minimalize your risk take chance to investment funds and maximalize your profit: a supply of capital belonging to numerous investorsa that is used to collectively purchasea securities while each investor retains ownership and control of his or her own shares. An invest fund provides a broader selection of investment opportunities, greater management expertise and lower investment fees than investors might be able to obtainaon their own. Types of I funds include mutual funds, exchange traded funds, money market funds and hedge funds. Individual investors do not make decisions about how a fund’s assets should be invested. They simply choose which fund to invest in based on its goals, risk, fees and other factors. A fund manager actually oversees the fund and decides which securities it should hold, in what quantities and when they should be bought and sold. purchase shares online|buy shares online|buy stock online|buying stocks online|buy stocks internet|investing in shares|how to buy shares online|share market online|trade stocks online|how to purchase shares investment.