Investing is all about striking the right balance between risk and return. There are different types of risks in the stock market and there are ways to mitigate them. All investors naturally want to ...

Here at Investopedia, we emphasize the importance of prudent investing—put at stake only what you can afford to lose and ensure your choices align with your financial goals and risk tolerance. This ...

Systemic risk is the risk that a company-level event could destabilize an entire industry. Think back to the financial crisis of 2008, when many companies deemed “too big to fail” did exactly that. To ...

Investment risk refers to the potential for an investment to experience a loss or deviation from its expected return and can come from a variety of places. All investments carry some level of risk ...

Idiosyncratic risk is unique to specific investments like companies or industries. Systematic risk impacts all investments and is driven by macroeconomic factors. Mitigate idiosyncratic risk by ...