Risks and benefits

What you'll learn:

• The risks of investing in shares
• The rewards of investing in shares

You’ve probably heard the old investment saying ‘the higher the return, the higher the risk’. Well, it’s true. Shares have higher returns than some other types of investments, so there are naturally some risks to owning them.

But ‘risk’ is not the dirty word some people think. Without taking some risk you simply wouldn’t get the higher returns you seek. And as we saw earlier, stuffing your money under the mattress or placing it in cash for long periods are actually pretty risky strategies themselves. Inflation will erode its value pretty quickly.

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