Risk Seeking

AAA

DEFINITION of 'Risk Seeking'

The search for greater volatility and uncertainty in investments in exchange for anticipated higher returns. Risk seekers might pursue investments such as small-cap stocks and international stocks, preferring growth investments over value investments.That being said, risk-seeking investors should conduct even greater due diligence when considering a riskier investment, due to the increased implied risk of such investments.

INVESTOPEDIA EXPLAINS 'Risk Seeking'

Risk seeking might also describe an entrepreneur who is willing to give up the stability of salaried employment with another company to start his or her own company in the hope of a greater financial and/or emotional payoff. A risk tolerant investor, on the other hand, might seek more of a balance between risk and stability by including more value stocks and fixed income securities in his or her portfolio; a risk averse investor would focus mainly on investments with slow but steady returns.

VIDEO

RELATED TERMS
  1. Event Risk

    1. The risk due to unforeseen events partaken by or associated ...
  2. Systematic Risk

    The risk inherent to the entire market or entire market segment. ...
  3. Risk Curve

    A two-dimensional plot of real or projected financial harm/risk ...
  4. Risk

    The chance that an investment's actual return will be different ...
  5. Risk-Adjusted Return

    A concept that refines an investment's return by measuring how ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in ...
Related Articles
  1. Entrepreneurship

    Identifying And Managing Business Risks

    There are a lot of risks associated with running a business, but there are an equal number of ways to prepare for and manage them.
  2. Personal Finance

    Using Economic Capital To Determine Risk

    Discover how banks and financial institutions use economic capital to enhance risk management.
  3. Risk management is an essential but often overlooked prerequisite to successful active trading.
    Trading Strategies

    Risk Management Techniques For Active Traders

    Use stop-loss and take-profit points to your advantage with these strategies.
  4. Options & Futures

    Managing Interest Rate Risk

    Learn which tools you need to manage the risk that comes with changing rates.
  5. Active Trading Fundamentals

    Analyzing Mutual Fund Risk

    Find out whether a fund's performance is a result of the manager's abilities, or just a fluke.
  6. Active Trading Fundamentals

    Using Logic To Examine Risk

    Know your odds before you put your money on the table.
  7. Retirement

    The Evolution Of Enterprise Risk Management

    This growing sector can tell you a lot about the companies you are investing in.
  8. Investing on margin can be profitable but it's a risky play that needs care.
    Trading Strategies

    Margin Investing: Big Risk, Big Reward

    Investing on margin can be profitable but it's a risky play that needs care.
  9. Investing Basics

    Online Portfolio Management, DIY or Fee-Based Financial Advisor: Which Is Right For You?

    Should you use an online financial planning service, or do professional, fee-based financial planners justify their higher costs?
  10. Chart Advisor

    A Total Stock Market ETF For Any Portfolio

    Utilizing index funds and ETFs, such as Vanguard's VTI, is one of the best ways for the average investor to track the broad markets and minimize fees.

You May Also Like

Hot Definitions
  1. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  2. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  3. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  4. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  5. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
  6. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), expressed as a single percentage number that represents ...
Trading Center