Risk Seeking

Risk Seeking

The search for greater volatility and uncertainty in investments in exchange for anticipated higher returns. Risk seekers might pursue investments such as small-cap stocks and international stocks, preferring growth investments over value investments.That being said, risk-seeking investors should conduct even greater due diligence when considering a riskier investment, due to the increased implied risk of such investments.

Risk seeking might also describe an entrepreneur who is willing to give up the stability of salaried employment with another company to start his or her own company in the hope of a greater financial and/or emotional payoff. A risk tolerant investor, on the other hand, might seek more of a balance between risk and stability by including more value stocks and fixed income securities in his or her portfolio; a risk averse investor would focus mainly on investments with slow but steady returns.


Investment dictionary. . 2012.

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  • risk-seeking — Readiness to assume high rates of *risk in order to achieve opportunities for high *returns. Risk seeking investors are deemed to have high *risk appetites. In contrast to a *risk averse individual, for example, a risk seeker would tend to reject …   Auditor's dictionary

  • risk-seeking — Describing a risk preference in which the decision maker s attraction to an investment or other economic choice rises with higher average returns and a higher standard deviation of returns. Compare risk averse; risk neutral …   Big dictionary of business and management

  • Risk aversion — is a concept in psychology, economics, and finance, based on the behavior of humans (especially consumers and investors) while exposed to uncertainty. Risk aversion is the reluctance of a person to accept a bargain with an uncertain payoff rather …   Wikipedia

  • Risk — takers redirects here. For the Canadian television program, see Risk Takers. For other uses, see Risk (disambiguation). Risk is the potential that a chosen action or activity (including the choice of inaction) will lead to a loss (an undesirable… …   Wikipedia

  • Risk perception — is the subjective judgment that people make about the characteristics and severity of a risk. The phrase is most commonly used in reference to natural hazards and threats to the environment or health, such as nuclear power. Several theories have… …   Wikipedia

  • Risk neutral — In economics, risk neutral behavior is in between risk aversion and risk seeking. If offered either 50 EUR or a 50% chance of 100 EUR, a risk averse person will take the 50 EUR, a risk seeking person will take the 50% chance of 100 EUR, and a… …   Wikipedia

  • Risk Neutral — Indifference to risk. The risk neutral investor would be in the middle of the continuum represented by risk seeking investors at one end, and risk averse investors at the other extreme. Risk neutral measures find extensive application in the… …   Investment dictionary

  • Risk-neutral measure — In mathematical finance, a risk neutral measure, is a prototypical case of an equivalent martingale measure. It is heavily used in the pricing of financial derivatives due to the fundamental theorem of asset pricing, which implies that in a… …   Wikipedia

  • risk aversion — Attitudes toward *risk characterized by avoidance or minimization. Risk averse investors are deemed to have low *risk appetites they prefer certain but relatively low rates of *return over doubtful but higher rates of return. For example, an… …   Auditor's dictionary

  • risk preference — The attitude of an investor or decision maker to risks. See risk averse; risk neutral; risk seeking …   Big dictionary of business and management

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