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Foundations · F3

Risk and Return

Risk means two different things: your money dropping in value, and your money falling behind rising prices. This module shows you both, how to measure them, and how to read a projection.

By the end of this module, you’ll be able to:

  • Tell the risk of a fall from the risk of inflation.
  • Work out what a typical year’s fall could mean for your balance.
  • Read a projection as a range rather than a prediction.
  • Explain what changes as you move through the seven risk bands.
  • Spot the choices that can make a market fall cause lasting harm.

7 parts · about 55 minutes

  1. 1What risk actually means: it drops, and it falls behind
  2. 2Measuring the drop: one number, and what it can’t tell you
  3. 3Why falls hurt twice, and what time can and can’t fix
  4. 4The seven bands, and the two reads behind your risk ceiling
  5. 5Thinking in ranges: Lower, Expected, Higher
  6. 6When it goes wrong: crashes, and the year the bonds fell too
  7. 7Your own band, and the one question to ask before changing it

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