Risk is a price you pay for opportunity

The economy was in a downfall, hundreds of thousands of people were losing their jobs on a monthly basis. Stocks went on sale with the S&P 500 and The Dow Jones industrial average in full bear territory. Home prices were down, home foreclosure was on the rise, people were defaulting on their mortgage loans. Lehman Brothers and some other banks were closing down, General Motors and Chrysler filed for bankruptcy. The economy was in a freefall, there was a tremendous panic in the land. That was the year 2009. The United States of America Sneezed and the rest of the world caught a cold with resulting market turbulence all over the world.

Do you know that amidst the pandemonium caused by the 2008/2009 economic recession in America, some few people took risks and they reaped bountiful rewards when the economy picked up?

In the aftermath of the financial crisis, Warren Buffett invested $5 billion in Bank of America stock, and fast-forward six years later, that investment resulted in a gain of more than $14 billion. Now you may not be Warren Buffett, but do you know that if you had invested $1,000 on Apple share in May of 2008, that amount would have grown to over $7,000 ten years later.

In this case, you risk your money by investing in the market, and the returns is an opportunity to improve your financial status. Many people are risk-averse. They do not invest for fear of losing their capital. The truth is, by not taking the risk to invest, they are inadvertently risking the effect of inflation on their money.

To win in life, you have to be able to take some calculated risks, because risk is the price you pay for opportunities.

You risk betrayal by trusting people.

You risk loneliness by not having friends you can confide in.

You risk heartbreak by falling in love.

You risk a road accident by driving your car.

You risk failure by starting a business.

You risk the possibility of getting laid off by working for a company.

You risk becoming outdated by staying consistent with your old tried and trusted systems.

You face uncertainties by stepping out of your comfort zone to try new things.

In the end, to live your life to the fullest, you need to take a risk and explore new things because you will gain new perspectives and increase your knowledge. Life is not always about win or lose, but rather it is about what you learn in the process whether or not the risk works in your favor. You must, however, be able to know when to play or when to fold, you must do your due diligence and ensure you are not making decisions irrationally. You must take calculated risks, and when you fail, don’t forget to learn from your experience.

For risk is a price you pay for opportunity.