What are the risks involved in investing?

All investments involve taking on risks. You must go into any investment in stocks, bonds, or mutual funds with a full understanding that you could lose some or all of your money in any one investment. While over the long term the stock market has historically provided around 10% annual returns. However, those that kept adding money to the market throughout that time would have done very well for themselves, as the lower cost of stocks in the 1930s made for some hefty gains for those who bought and held over the next twenty years or more.