Financial markets: Understand and interpret volatility correctly
Article by Simon Landt
No pain, no gain - you probably know this saying. Similarly, the conflict applies to the financial markets: without risk, there is no return. If you are promised a risk-free investment opportunity with fantastic returns, it is time to listen up and move away as quickly as possible. Because (unfortunately) high returns cannot be achieved on the financial markets without risk. In fact, price fluctuations on the financial markets are as certain as Amen in church.
In today's issue of you will find out what pitfalls you need to be aware of when classifying the risk of various investment options, how to correctly classify volatility and what a thought experiment reveals about our risk perception: