|  OCT 1986

Part 1 Assessing risk on Wall Street A philosophy of investing by Thomas A. Rorro

part 1 Assessing risk on Wall Street A philosophy of investing by Thomas A. Rorro The goal of investing is to make a profit. To achieve this goal, the investor places his money at risk—with the hope of increasing his wealth. Whether by buying real estate, depositing funds in a savings account, or buying shares of stock, the investor wants to protect his current assets and make a profit. Investors invest with an intuitive knowledge of risk. But only the banking community has been able to quantify both the expected profit and the risk. Most banks provide a specified rate of return in a risk-free environment. The risk is removed by the federal government through the Federal Deposit Insurance Corp. (FDIC) or a similar agency. Prudent money market investors carefully scrutinize interest rates knowing that the risk is negligible.

by Thomas A. Rorro