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The Complete Idiot's Guide to Stock Investing Fast-Track by Ken Little

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Risk and Reward

Investing in stocks (or almost anything else) entails taking some risk. There is no investing in stocks without risk and there is no return without risk. That is absolutely the most important truth you need to understand when formulating an investment strategy. If you are adverse to the idea of taking any amount of risk, then stocks are not for you. It will be more difficult (but not impossible) for you to reach your financial goals without investing in stocks.

One of the most important and often misunderstood considerations in shaping an investment strategy is the relationship of risk and potential reward in stock investing.

Understanding Risk

Risk is the potential for your investment to lose money, for a variety of reasons—meaning ...

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