Risk is defined by both the probability of an outcome and the magnitude of the potential result, meaning an event with a high probability but low impact may be considered less risky than an event with a lower probability but a significant potential loss.

Authors

• Person: Not available Organization: Pressbooks
  Chapter 8 – Risk and Return – Fundamentals of Finance

Sources

• Chapter 8 – Risk and Return – Fundamentals of Finance pressbooks.pub Pressbooks via serper

Referenced by nodes (2)

• probability concept
• risk concept