What are the risks of investing in financial management?

There is no risk-free investment, especially financial investment, and risks occur with investment. Among all kinds of investments, stocks, funds and bonds are common. What are the risks associated with these investment products?

First, market risk.

Market risk refers to the risk that the price or value of derivative products will change due to adverse changes or sharp fluctuations in the market price of basic assets. Market risk depends on the proportion in an asset.

For example, if you buy a stock in the technology industry, your stock is at risk of losing money. We can control market risk by diversifying our assets into different industries.

Second, the risks of listed companies.

Behind the stock is the listed company, and the short-term fluctuation of the stock comes from the operation of the listed company and the stock price risk.

The operation risk of a company will affect its operation and performance, and the stock price risk is mainly related to the performance of the stock price.

Equity funds mainly invest in the stock market, and the biggest risk of equity funds lies in the stocks held by the funds. Therefore, when we choose a fund, we must pay attention to the stock selection logic of the fund and attach importance to the study of fundamentals.

Third, economic risks.

Some assets fluctuate with the economic situation. In good times, such assets performed well, and in bad times, such funds also declined. Inflation, interest rate and other factors will lead to short-term fluctuations in the market.

If you want to avoid the impact of economic risks as much as possible, you can choose some industries that are less affected by the cycle.

Fourth, risks at the national level.

Risks at the national level include international economic status, national policies, exchange rates and so on. We can diversify national risks by investing in securities from different countries or regions.

The risk cannot be eliminated, but we can control the risk through our own ability and invest within our control.