Financial literacy guide

Investment risk and return basics

Investment returns are uncertain, and products offering higher potential returns generally involve some form of increased risk.

RiskReturn

Editorial review: August 11, 2026 · Lauren M. Whitfield

Return is not guaranteed

Historical results do not promise future performance.

Different risks exist

Market, credit, interest-rate, liquidity and concentration risk can affect investments in different ways.

Time horizon and capacity matter

A loss is harder to absorb when the money is needed soon or represents essential reserves.

Avoid guaranteed-high-return claims

Promises of high returns with little or no risk are a classic warning sign for fraud.

Educational information only. Use current product terms and the rules that apply in your country. For decisions with significant financial consequences, consider an appropriately qualified professional.