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2). Know Your Tolerance for Investment Risk Before Designing an Investing Program By : Mark Kramer
What is risk tolerance? It’s your ability to deal with investment losses … usually in the short-run … to have the chance of earning higher long-term returns than you would get in a bank account.
On the one hand it’s about how much you can afford to lose.
On the other hand, it’s also about how much money you can emotionally tolerate losing.
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