June 10, 2024
It’s important to grasp the risks associated with investments to effectively manage a diverse portfolio. Inflation risk highlights the risk of losing purchasing power and investment returns if assets fail to outperform inflation rates, emphasizing the importance of investing in growth-oriented assets.
When interest rates go up, bond values tend to decrease as newer bonds offer yields, impacting bond investments. Economic risk plays a role in a company’s profitability during downturns with certain sectors bouncing back quicker than others.
Market risk poses the threat of investment losses during market declines, affecting asset classes like stocks, bonds, and real estate.
Lastly, specific risks are tied to events that affect companies or industries directly such as changes in leadership or other severe issues. Understanding these risks is key for developing strategies to minimize their impact on investment portfolios.
Key Takeaways:
It’s imperative for investors to have a regular evaluation of their risk exposure. Seeking professional advice from a fiduciary wealth management advisor will help to ensure that their investment strategies will match their risk tolerance and financial goals, leading to a more cautious investment approach.
At Landsberg Bennett Private Wealth Management, we believe that it is much better not to be wrong than it is to be right. This principle has helped us create long-term, and personalized investment management services for our clients, helping to ensure that their investment strategies and risk tolerance are well taken care of.
Landsberg Bennett is a group comprised of investment professionals registered with Hightower Advisors, LLC, an SEC registered investment adviser. Some investment professionals may also be registered with Hightower Securities, LLC (member FINRA and SIPC). Advisory services are offered through Hightower Advisors, LLC. Securities are offered through Hightower Securities, LLC.
This is not an offer to buy or sell securities, nor should anything contained herein be construed as a recommendation or advice of any kind. Consult with an appropriately credentialed professional before making any financial, investment, tax or legal decision. No investment process is free of risk, and there is no guarantee that any investment process or investment opportunities will be profitable or suitable for all investors. Past performance is neither indicative nor a guarantee of future results. You cannot invest directly in an index.
These materials were created for informational purposes only; the opinions and positions stated are those of the author(s) and are not necessarily the official opinion or position of Hightower Advisors, LLC or its affiliates (“Hightower”). Any examples used are for illustrative purposes only and based on generic assumptions. All data or other information referenced is from sources believed to be reliable but not independently verified. Information provided is as of the date referenced and is subject to change without notice. Hightower assumes no liability for any action made or taken in reliance on or relating in any way to this information. Hightower makes no representations or warranties, express or implied, as to the accuracy or completeness of the information, for statements or errors or omissions, or results obtained from the use of this information. References to any person, organization, or the inclusion of external hyperlinks does not constitute endorsement (or guarantee of accuracy or safety) by Hightower of any such person, organization or linked website or the information, products or services contained therein.
Click here for definitions of and disclosures specific to commonly used terms.