“Risks” refer to the possibility of undesirable events occurring or outcomes of an activity being worse than initially expected. From an economic or financial perspective, the risks depend on the activity in question. Generally, risks involve potentially losing money or earning less than anticipated. “Uncertainty” refers to the difficulty of knowing the future, which is unpredictable.
In the following sections, we will focus on risks associated with the most common financial operations and how you should account for them in your financial planning.
