Why Trading and Investing Mean Managing Risk

Education

Oct 11

Why Trading and Investing Mean Managing RiskMinimise your risk and you’ll prosper. 

Sandy JadejaA question financial educator Sandy Jadeja gets asked often is, Isn’t trading and investing risky?

“Of course,” he says. “Is investing in a property risky? Of course it is.”

The important thing to have perspective on that risk.

“Is marrying the wrong person or taking the wrong job risky? Of course. Crossing the road is risky.”

There’s risk everywhere. 

What you should really focus on when it comes to trading and investing is minimising the risk.

“There are techniques in the financial markets which we call scalability,’” explains Sandy.

“We can actually take the risk right down. We take very small amounts of money, something as simple as 250 pounds, and use that as startup capital to take a very, very small amount of risk in the financial markets.”

It’s also important to remember that there’s risk involved with just leaving your money in the bank. As Sandy points out, banks can fail.

“Take Cyprus for an example,” he says. “People had been saving up, putting their money in the banks in Cyprus and suddenly this disaster happens and what happens?”

“People lose their money, their savings that they were planning for years for retirement. So there’s risk everywhere.”

How much risk can we tolerate?

“What we need to do as individuals, first of all, is to understand ourselves,” says Sandy. “And then we can figure out what tools can we use to minimise that risk.”

“The risk is everywhere. Understand that there are techniques and strategies you can use to minimise the risk, and in some cases even avoid risk.”

Want to learn more about trading and investing?

Sandy’s offering his Fast Profits Trading Strategies course in London in January. Click here for more info!

NOTE: This post was originally published 26 November, 2018, and has been updated for freshness, accuracy and comprehensiveness.

Want more content like this? Sign up for our weekly newsletter!