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Author: Mark Kramer Article source: http://www.articlealley.com/. Used with author's permission.
Know Your Tolerance for Investment Risk
Before Designing an Investing Program
by Mark Kramer
What is risk tolerance and how does it influence your investment decisions? Understanding what you can and cannot emotionally tolerate losing will help you make better investment decisions and ultimately gain higher returns.
What is risk tolerance? It's your ability to deal with investment losses … usually in the short-run … to have the chance of earning higher long-term returns than you would get in a bank account.
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