TheRiskBlog

Up to now it was a tedious process that required skills and knowledge. Well, the bad news is, it still does, but the task got easier.Imagine you could use an easy way of comparing a stock to any other stock on the market and even to the index itself. That way you would be able to tell real quick, whether a single stock is risky or not and whether you could invest your hard earned money in it or not.

We live in 2009 and of course there is a tool out there, that does the job and it is not hidden in a secret place on the web or on a site you would never find. No, it is readily available on the NASDAQ website.

You can measure your risk with it.

All you have to do is follow the instructions on the NASDAQ website and in a few seconds you know what kind of risk you are taking when investing in the stocks you put in. If the result is in the green, everything is fine but you most probably found a stock that doesn´t make you a ton of money, it is just safe. If it is in the red you should avoid investing in the stock, since the risk is to high.

There is one downside to the process though. The result you get, does show you the individuel risk in a stock compared to the indes and a measurement range, but it does not interconnect these data with your account. So you get the risk involved in the stock but not in your account. You still have to figure out whether it makes sense to invest in the stock taking into consideration your profit and loss in the account. If you have made money recently, you could invest in stocks that even go into the red, but if you lost some money you want to stay in the green.