... definition bonds still remain high risk asset. When investing in an asset, the relationship between risk and return is one of the essential concepts to understand. It is also very different from an investor to the other, since people are risk adverse (a big majority) while some are risk assertive. Consequently some investors would agree to withstand a higher level of market volatility and risk, while others would prefer a more conservative and "safer" approach. The risk profile of an investor translates into a more or less disciplined approach to investing. Risk can be seen as the potential of an investment to generate financial loss while return is the usual measure of performance, as investments that offer higher potential for total return generally carry a higher potential for risk. The major determinant of the required return on the asset is its degree of risk. Risk refers to the probability that the return and ...

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