Markowitz Risk: The Investor's Benefit
Abstract
Buying or sacrificing something today, with the intent of creating a stream of wealth in the future or preventing wealth destruction in the future is Investment. For the individual, it is the exchange of the money ur cash for a future claim on money or the purchase of a security of a promise to pay at a later date along with a regular income as in the case of a share, bond, debenture etc. Purchase of assets like shares and securities can be for either investment or speculation or both. Investment is long term in nature. While speculation is short term. Investment aims at income and normal long term capital growth while speculation aims only at short term trade gains through buying and selling. Hence, it becomes a matter of risk exposure or tolerance of an individual. Basically both aim at income and capital appreciation. But the difference is in motives and objectives. All investments are risky to some extent but speculation is more risky as it involves short term trading, buying and selling which may lead to profits some times and losses at other times.Downloads
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