Join Courses
Attend Webinars
Get Free Counselling
  • Select Language
    • Hindi
    • Bengali
+91 9903 222 555
Elearnmarkets - Financial Market Learning
Join Courses Of Elearnmarkets
  • Basic Finance
  • Technical Analysis
  • Fundamental Analysis
  • Derivatives
  • Financial Planning
  • Miscellaneous
No Result
View All Result
  • Basic Finance
  • Technical Analysis
  • Fundamental Analysis
  • Derivatives
  • Financial Planning
  • Miscellaneous
No Result
View All Result
Elearnmarkets - Financial Market Learning
Home Financial Planning
Take a Risk

How “risky” is risk?

Elearnmarkets by Elearnmarkets
February 6, 2016 - Updated on November 18, 2020
Reading Time: 5min read
0
2.1k
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn

Do you love taking a risk? Do you have risk taking ability?

No! Let me tell you that “risk” is a term which is often used in a negative sense.

Frankly speaking, risk is present everywhere and it is just that it can be used in a relative sense i.e. less risky or more risky.

Allow me to share what the most successful investor of our generation has to say about risk:

Table of Contents
Factors that determine risk taking Ability
  • Income
  • Age
  • Dependants
  • Debt
  • Area of work
Bottomline

Most of the time, it’s not that you don’t want to take a risk but a combination of certain factors stops you to do so.

Factors that determines Risk Taking Ability

risk taking ability

1. Income

An Erratic source of income can impact your risk profile.

Individuals who don’t get paid on a monthly basis needs to maintain a liquid investment in a buffer to meet the situation of emergencies.

On the other hand, a salaried person who has a regular source of income can opt for instruments which have a short-term risk but may give a higher return in the long run.

2. Age

It is one of the most important factors in your risk profile.

You can take more risk in the early stage of your life than you grow old.

You can choose to invest a large part of your savings in equities in your early days and reduce the proportion going forward.

Moreover, these equities work well in long -term so it’s always a better idea to start early in a systematic manner.

Know More:  What Is The Minimum Age Limit To Invest In Share Market?

3. Dependants

The level of risk tolerance is also impacted by the level of dependency.

An individual should not take a higher risk if he/she is the sole earning member of the family.

Moreover, he/she should also have a large emergency fund and insurance policies for the family members.

Evaluate to invest in stock market with Stock Investing Made Easy course by Market Experts

On the other hand, an individual with a working spouse and no dependents can choose to have a risk.

4. Debt

Avoid taking debts as possible.

But if you already have a bigger debt like a home loan or any other debt, avoid taking big risks with your savings.

However, you can choose to invest in a riskier asset if you don’t have a burden of any liabilities.

Please avoid using credit cards as it is a weapon of mass destruction.

5. Area of work

The place where you are currently working determines the stability of your income.

To start managing your personal finances, you can take help of Kredent Money App.

The person working in a well-established firm at a better post would be in a better position to take a risk as compared to a person working in a young start-up company or in BPO sector, which poses a little doubt in the stability of your work.

Bottomline

A risk is present everywhere and you just need to figure out which type of risk suits you.

The combination of smart decision and risk taking ability could help you to achieve your goal and lead you to success.

Keep learning!!

Tags: basicDiversificationenglishinvestment planningriskrisk management
ShareTweetShare
Subscribe To Updates On Telegram Subscribe To Updates On Telegram Subscribe To Updates On Telegram
Previous Post

A Complete Guide in Planning Your Monthly Budget

Next Post

How to send a Demand Draft?

Elearnmarkets

Elearnmarkets

Elearnmarkets (ELM) is a complete financial market portal where the market experts have taken the onus to spread financial education. ELM constantly experiments with new education methodologies and technologies to make financial education effective, affordable and accessible to all. You can connect with us on Twitter @elearnmarkets.

Related Posts

Financial Planning

Why a Mediclaim Policy is Critical for our Financial Well-Being

February 23, 2021
47
Financial Planning

Fund Manager – Why & How to choose the right Fund Manager?

December 29, 2020
684
Financial Planning

Debt Mutual Funds – Meaning and Types of Debt Funds

October 24, 2020 - Updated on November 18, 2020
426
Financial Planning

5 Products to help us plan for Retirement

October 10, 2020 - Updated on December 2, 2020
818

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Follow Us

Download App

Register on Elearnmarkets

Continue your financial learning by creating your own account on Elearnmarkets.com

Register Free Account

GET ARTICLES ON EMAIL

Enter your email address:

Categories

  • Banking
  • Basic Finance
  • Bonds & Fixed Income
  • Budgeting & Savings
  • Capital Markets
  • Charts
  • Charts, Patterns & Indicators
  • Commodity, Currency & FOREX Market
  • Derivatives
  • ETFs & Mutual Funds
  • Financial Planning
  • Financial Statement Analysis
  • Fundamental Analysis
  • Macroeconomics
  • Market Analysis
  • Market Updates
  • Market Wrap
  • Marketshala
  • Miscellaneous
  • Open Interest
  • Personal Wealth
  • Retirement Planning
  • Sector Analysis
  • Tax Planning
  • Technical Analysis
  • Trading Terms, Rules & Strategies
  • Visit Elearnmarkets
  • Courses
  • Webinars
  • Financial Guides
  • Get Free Counselling

© 2020 Elearnmarkets All Rights Reserved

No Result
View All Result
  • Article Categories
  • Basic Finance
  • Derivatives
  • Financial Planning
  • Fundamental Analysis
  • Market Analysis
  • Miscellaneous
  • Technical Analysis
  • Select Language
    • Hindi
    • Bengali
  • Learn finance
  • Browse Courses
  • Webinars
  • Free Guides
  • Get Free Counselling

© 2020 Elearnmarkets All Rights Reserved