What Investment Risks Should I Know About?

Taken by itself, the word "risk" sounds negative. But broken down into what it really stands for in terms of investing, it begins to be a little more manageable. By understanding the different types of risk and keeping an eye on your investments, you may be able to manage your money more effectively. Remember, strategic investing doesn’t mean "taking chances" so much as "making decisions." Long-term investing and diversification may be some of the most effective strategies you can use to help manage investment risk; however, neither guarantees against investment loss.

Inflation Risk

The main risk from inflation is the danger that it will reduce your purchasing power and the returns from your investments. If your savings and investments are failing to outpace inflation, you might consider investing in growth-oriented alternatives such as stocks, stock mutual funds, variable annuities, or other vehicles.

Interest Rate Risk

Bonds and other fixed-income investments tend to be sensitive to changes in interest rates. When interest rates rise, the value of these investments falls. After all, why would someone pay full price for your bond at 2% when new bonds are being issued at 4%? Of course, the opposite is also true. When interest rates fall, existing bonds increase in value.

Economic Risk

When the economy experiences a downturn, the earnings capabilities of most firms are threatened. While some industries and companies adjust to downturns in the economy very well, others — particularly large industrial firms — take longer to react.

Market Risk

When a market experiences a downturn, it tends to pull down most of its securities with it. Afterward, the affected securities will recover at rates more closely related to their fundamental strength. Market risk affects almost all types of investments, including stocks, bonds, real estate, and others. Historically, long-term investing has been a way to minimize the effects of market risk.

Specific Risk

Events may occur that only affect a specific company or industry. For example, the death of a young company’s president may cause the value of the company’s stock to drop. It’s almost impossible to pinpoint all these influences, but diversifying your investments could help manage the effects of specific risks.

The information in this article is not intended to be tax or legal advice, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek tax or legal advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Emerald. © 2012 Emerald Connect, Inc. 

Szarka Financial
29691 Lorain Road North Olmsted, OH 44070
Phone:

440.779.1430

800.859.8095

Fax: 440.779.0746
info@szarkafinancial.com

Connect to us on Facebook Connect to us on Linkedin Visit our YouTube Channel

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

* Required
Subscribe to Our Mailing List

First Name:


*

Last Name:


*

Email:


*

Email Format

CBC Magazine

Szarka Financial was recently featured in the March issue of CBC Magazine



Job Seeker's Networking Event

Come, meet some new people and begin to develop relationships that just might provide you a path to a new job opportunity!


6:30 - 8:30 pm
Wed, April 25th

Mavis Winkle’s
1st floor in the Crown Office Bldg,
5005 Rockside Rd
Independence, OH 44131
Map & Directions

Please click here to RSVP.



Career Transition Camp Follow Up

We had such an overwhelming response to our offer of assisting with networking, interviewing and resumes that we decided to offer another workshop.


6:30 - 8:30 pm
Wed, April 16th

Szarka Financial
29691 Lorain Rd
North Olmsted, OH 44070
Map & Directions

Please click here to RSVP.



Economic Update

Make plans to attend one of the Spring Economic Update sessions to hear some of the looming issues affecting the markets.


Chuck Conrad, JD &
Rick Martin CFP®


April 24th, 2012
12:00 - 2:00 pm
April 26th, 2012
6:00 - 8:00 pm

Szarka Financial
29691 Lorain Rd
North Olmsted, OH 44070

Please click here to RSVP.



Economic Update

Make plans to attend one of the Spring Economic Update sessions to hear some of the looming issues affecting the markets.


Mark Stratis, CFP®

April 26th, 2012
12:00 - 2:00 pm
May 1st, 2012
6:00 - 8:00 pm

Szarka Financial
29691 Lorain Rd
North Olmsted, OH 44070

Please click here to RSVP.



Economic Update

Make plans to attend one of the Spring Economic Update sessions to hear some of the looming issues affecting the markets.


Alex Menassa, MBA, CPA

May 1st, 2012
12:00 - 2:00 pm
May 3rd, 2012
6:00 - 8:00 pm

Szarka Financial
29691 Lorain Rd
North Olmsted, OH 44070

Please click here to RSVP.



Planning for the Cost of Education

Mark Stratis will share tips developed by the FPA to help you navigate the challenge of paying for a college education.


Mark Stratis, CFP®

June 14th, 2012
7:00 - 8:30 pm

Cuyahoga County Public Library
Fairview Park Branch
21255 Lorain Road
Fairview Park, Ohio 44126

Please click here to RSVP.

Contact Info

29691 Lorain Rd. N. Olmsted, OH 44070

info@szarkafinancial.com

Phone:
440.779.1430
800.859.8095

Fax:
440.779.0746

Due to various state regulations and registration requirements concerning the dissemination of information regarding investment products and services, we are currently required to limit access of the following pages to individuals residing in states where we are currently registered.

A broker/dealer, investment advisor, BD agent or IA rep may only transact business in a particular state after licensure or satisfying qualifications requirements of that state, or only if they are excluded or exempted from the states broker/dealer, investment adviser, or BD agent or IA rep requirements, as the case may be; and follow-up, individualized responses to consumers in a particular state by broker/dealer, investment adviser, BD agent or IA rep that involve either the effecting or attempting to effect transactions in securities or the rendering of personalized investment advice for compensation, as the case may be, shall not be made without first complying with the states broker/dealer, investment adviser, BD agent or IA rep requirements, or pursuant to an applicable state exemption or exclusion.

Investments products and services available only to residents of : Alabama (AL), Arizona (AZ), California (CA), Colorado (CO), Connecticut (CT), Delaware (DE), Florida (FL), Georgia (GA), Iowa (IA), Illinois (IL), Kentucky (KY), Massachusetts (MA), Maryland (MD), Michigan (MI), Minnesota (MN), Missouri (MO), Nevada (NV), North Carolina (NC), New Jersey (NJ), New Mexico (NM), Nevada (NV), New York (NY), Ohio (OH), Oregon (OR), Pennsylvania (PA), South Carolina (SC), Tennessee (TN), Texas (TX), Virginia (VA), Washington (WA), Wisconsin (WI), West Virginia (WV)

*Securities and investment advisory services offered through FSC Securities Corporation, member FINRA/SIPC and a registered investment advisor. Insurance services offered through Szarka Financial, which is not affiliated with FSC Securities Corporation.

PLEASE NOTE: The information being provided is strictly as a courtesy. When you link to any of the web sites provided here, you are leaving this web site. We make no representation as to the completeness or accuracy of information provided at these web sites. Nor is the company liable for any direct or indirect technical or system issues or any consequences arising out of your access to or your use of third-party technologies, web sites, information and programs made available through this web site. When you access one of these web sites, you are leaving our web site and assume total responsibility and risk for your use of the web sites you are linking to.

©2012 Szarka Financial