Wednesday, April 3, 2013

Understanding calculated risk and its impact on investments

 Very often, one comes across certain clichéd terms, one wonders whether the user understood the meaning of what was said. The other day, I was having a discussion with someone who was concerned about the loss in an equity mutual fund account. He had been investing in this account through SIP for almost three years now. The moment I indicated that equity investments are always subject to a higher risk that this gentleman uttered a very commonly used phrase that he understood the risk and he always took “calculated risk”.

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