All of the recent hype surrounding Gamestop, cryptocurrency, non-fungible tokens (NFTs), and meme stocks made me question – is anyone risk-averse anymore?
Risk aversion is defined as avoiding risk. Pretty straightforward.If you are a risk-averse investor, you will seek out investments with a low probability of declining in value.
While you invest the vast majority of your wealth in stocks, it’s either in index funds and mutual funds or in a portfolio of dividend-paying stocks that have the right level of diversification.
While you may still invest primarily in the stock market if you have a low-risk aversion, you also have a high probability of investing in cryptocurrency and even day trading stocks.