Risk management is the foundation of successful investing. While higher returns often come with higher risk, strategic risk control can help you achieve long-term growth without jeopardizing your capital.

The first step in managing risk is understanding the different types: market risk, credit risk, liquidity risk, and inflation risk. Diversification is a common method to reduce market risk, while thorough research can help avoid poor-quality investments. Setting stop-loss orders and defining maximum exposure per asset are practical ways to protect against significant losses.

Another important aspect is maintaining an emergency fund. Having cash reserves allows you to avoid selling investments during downturns at unfavorable prices. Risk management is not about avoiding risk entirely but balancing it according to your goals and comfort level. By making it a priority, you can navigate market uncertainty with confidence and consistency.