The Nature of Risk

Kevin Punitngs25 Nov, 2022Other

Back in the late 1800?s large risk averse investors held a major portion of their wealth in railroad bonds. This was before sophisticated institutional investment management services were available. Everyone agreed: that was the safest place to keep your money to earn a modest but dependable return. Unforeseen was the emerging importance of the automobile and the resulting bankruptcy of so many railroads. Overdependence on conventional wisdom and following the crowd is only one of a myriad of risks facing investors.