How to Diversify your Investment Risk
In the Future Invest Show Episode 10, Relf Lumley Portfolio Manager at Capricorn Asset Management (CAM) shares his expertise on Diversifying your Investment Risk. Lumley explains in more detail the concept of Investors Risk Tolerance.
“Risk Tolerance is an important concept for investors to grasp. Investors formulate their own views on risk and the level of risk they prefer to take as well as their ability to afford risk. Factors that impact affordability of risk are investor’s net asset wealth, age income and dependence on investments,” Lumley explained.
Lumley elaborates on:
- How to measure risk?
- Risks relating to your expected return?
- How to stabilize your return?
- The meaning of correlation,
- And how would diversifying your risk reduce volatility.
-Article and Interview by Maggie Forcelledo