risk

Possibility that an investment’s actual return will be different than expected; includes the possibility of losing some or all of the original investment. Traditionally measured by variability of historical returns or dispersion of historical returns around their average return. Investments have several major sources of risk that could produce unexpected returns: business and industry risk, inflation risk, market risk and liquidity risk. For an investment portfolio, risk can be defined as not having the money available to spend at the time you need to spend it.