Growth vs. Risk

Fundamentals of Market Investing by Adam J. McKee

 

When we are deciding on what baskets we want in our retirement account, it may be helpful to think in terms of a growth basket and a safety basket.  The growth basket will usually contain mostly equities since equities have the highest historical return on average.  They also have the most volatility so the day-to-day fluctuations can be nauseating.  This is a rather elementary way of thinking about it, but often simple is good enough.  For me, spending a lot of time and effort understanding investing, returns, risk, and portfolio allocation strategies has been worth it, and I am just beginning that lifelong journey.


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Last Updated: 6/25/2018

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