Overview Risk and return go hand in hand. Understanding this

 

Overview

Risk and return go hand in hand. Understanding this relationship is  critical to making well-reasoned financial decisions, whether you are  making personal investment decisions or working for a business where  you’re responsible for investing excess cash. This journal assignment  allows you to explore the risk-return relationship in the context of  investing in stocks in both of these roles.

Prompt

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 impacts stock  investment decisions, using examples to support your claims.
  • Reflection: Describe whether you make stock-investment decisions in your personal life and how you do or would make those decisions. 
    • Consider the following in your response: Would your decision-making  process change if you needed to make stock-investment decisions for a  business? Why or why not?

Guidelines for Submission

Your submission must 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

 

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