Every investment involves a possible gain and a possible loss. The risk/reward ratio compares how much you could lose to how much you could gain. Calculating this ratio may help you decide whether a ...

Downside risk refers to the potential for an investment to decrease in value. Unlike general risk, which considers both upward and downward price movements, downside risk focuses solely on the ...

Elvis Picardo is a regular contributor to Investopedia and has 25+ years of experience as a portfolio manager with diverse capital markets experience. Robert Kelly is managing director of XTS Energy ...