Risk ratings confusion

By Robert Stock The FSA proposal to risk grade fund sectors may help consumers understand more about their finances but depending on the definition of risk used, it could create further confusion. The Oxford English Dictionary defines risk as "the chance of loss or bad consequence". From a personal finance perspective this raises two basic definitions. The first is the risk of losing money, and here an equity investment has a greater chance of this than a building society. Secondly, there is the risk of not generating enough money in the long term by avoiding market exposure. According ...