What is Risk?

Let’s see the chart of living cost of middle class family –

• Risk is our rupee buys less than it does today ……..let`s see it with below chart

Year	Cost of living
1920 1940 1960 1980 2000	Rs. 1   Rs.10   Rs.100   Rs.1000   Rs.10000
2020	Rs.100000

•  There’s no investment in the world which gives higher returns without any risk.       

          > No risk, no returns 

          > Low risk, low return

• Risk isn’t investing in a right way and losing ground to inflation.

• Nothing is 100% safe, there are various types of risks in different asset class –

         > Fixed Deposit/Debt has “Default Risk” and “Interest Risk”

         > Real Estate/PPF/Other lock-in Schemes have “Liquidity Risk”

         > Equity has “Volatility Risk”

• Playing intelligently with volatility risk and interest rate risk is a way to be wealthy.

• If our investments are giving less returns after inflation and tax that is a risk of being poor in long-term.

•  Being a trader is risky, but buying and holding is not.

•  Risk is not achieving our dreams and aspirations.

Even a successful player or a wealthy person cannot be right every time…but managing risk intelligently and making our overall portfolio work rightly is important.