Determining Risk Versus Reward
As an investor, you’re always determining risk premium relative to US stocks. Without determining the risk versus reward, you are simply putting your money at risk.
Long investment positions of corporate common stocks carry inherent risks. Advisers, agents like to avoid this subject as it requires more profound considerations via the client investor, and understanding it would reveal the often unjustified entry-costs and management fees.
Risk of General Market Downturn
The stock markets have a positive correlation to general economic swings, and wield at least a couple of bearish years each decade. This leaves the probability of stock markets ending each year at higher levels of 70-80% at best. The industry analysts, advisers or brokers facilitate public ignorance of this easily in bullish periods, where any stock seems to rally effortlessly with the illusion that no forms of risk exist.
