Taking a Risk
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Making any form of investment involves a certain amount of risk. The amount of risk involved and the projected return will affect potential investors differently.

Taking our analysis a step further, we can state two types of risks exist, which will affect any investment decision:

SYSTEMATIC RISK: These include national influences which are common to any type of investment. Examples of systematic risk include national politics and legislation, economy status (peak, flat, decline), etc.

UNSYSTEMATIC RISK: These can be classed as specific influences, which will affect an investment decision for a business. Examples of unsystematic risk include changes in demand for a company's product, management strategy, changing business resources, etc.

All forms of investment will entail a degree of risk, it is up to the owners of the business to decide if the potential return on a investment will warrant the initial investment.

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