Returns, returns and more returns. If you have been following the financial media and analyst reports very closely and blindly, it is likely that your stock research might have been influenced to be upside-biased. The finance industry places a disproportionate emphasis on investment returns rather than investment risk.

However, we have greater control over the risks we take than the returns we chase. Hence, our first concern should always be risk management and not investment returns.

If we can take care of our downside, the upside will naturally take care of itself.

Now let us explore how experts and academics in the finance industry view investment risk. We will first talk about the concept of volatility in the stock market, followed by the application of volatility in finance and lastly, how value investors should approach investment risk. Hopefully, this will give you a good idea of the contrast between how