Not taking risks is itself a risky investment strategy

Many investors shy away from riskier investments for fear of losing money. But not taking risks can itself be a risky strategy in the long run. Tim Bennett explains.

The idea of risking your hard-earned savings in the stockmarket can be nerve-wracking. It may be tempting simply to stick your money in the bank. But what you must realise is that every investing decision you take including staying out of the market altogether carries risk. The key is understanding which risks you can afford to take, and which you should avoid. Here are some of the biggest.

Opportunity cost and inflation risk

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Tim graduated with a history degree from Cambridge University in 1989 and, after a year of travelling, joined the financial services firm Ernst and Young in 1990, qualifying as a chartered accountant in 1994.

He then moved into financial markets training, designing and running a variety of courses at graduate level and beyond for a range of organisations including the Securities and Investment Institute and UBS. He joined MoneyWeek in 2007.