Risk and return go together. You must understand this relationship to make informed financial decisions. This applies when you make personal investment decisions or when you’re investing excess cash for a business. In this journal assignment, you will explore the risk-return relationship when investing in stocks in both of these roles.
Write a journal discussing risk and return as it relates to investing in stocks.
Specifically, you must address the following rubric criteria:
- Investment Risk: Explain key risks associated with investing in stocks.
- Investment Return: Discuss events that can cause the price of a stock to increase or decrease.
- Risk-Return Relationship: Explain the relationship between risk and return and how this relationship affects stock-investment decisions. Use examples to support your claims.
- Reflection: Describe how you would make stock-investment decisions in your personal life. Also talk about how your decision-making process might change if you needed to make stock-investment decisions for a business.
What to Submit
Your submission should be a 4- to 5-paragraph Word document with 12-point Times New Roman font, double spacing, and one-inch margins. Sources should be cited according to APA style.