The age-old adage ‘no pain no gain’ has never been closer to the truth than when it comes to investing and balancing risk versus reward. Investing according to your individual risk tolerance is the key to long-term success in the stock market. The term risk and reward is a fundamental financial concept which implies that the higher the potential return and risk associated with an investment, the greater the potential reward. However, while higher potential returns come with elevated risk, investors should also consider the potential losses associated with any investing strategy. There are a variety of ways to approach risk when investing and allocating assets. Many investors adopt a diversified approach, meaning they spread out their assets across different asset classes, industries, and investment types. This is often referred to as a “diversified portfolio.” Diversification is generally viewed as the best way to attempt to balance the risk and reward equation, so it’s important to ke...