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Risky Asset
An investment that has a significant degree of uncertainty in its returns.
Asset Allocation
The process of spreading investments among various categories of assets (e.g., stocks, bonds, real estate) to optimize risk and return.
Risk Tolerance
The degree of variability in investment returns that an investor is willing to withstand.
Financial Statements
Formal records of the financial activities and position of a business, individual, or other entity, including the balance sheet, income statement, and cash flow statement.
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