What are some of the riskiest investments that you can invest in? What gets the most on returns and the least?

Answer 1

I have to agree with the 1st responder. Commodities are extremely risky. The reason they are is because they are purchased as futures on very low margin requirements--10%. And such events as a droubt or a freeze in Florida or Russia buying up the entire soy bean crop can cause prices to advance dramatically. Or in the recent case of oil and natural gas, prices can fall dramatically. In either case if one is caught on the wrong side of a position, the results can be catistropic, as a hedge fund recently discovered with their natural gas positions. Currency trading on the Forex falls also into that category as margin requirements are similar.

Similarly commodities and currencies and also yield the highest returns. Anyone who shorted oil back in June made a ton of money. In fact could have easily become a millionaire overnight. Similarly anyone who had shorted the dollar 3 years ago would also have done very well or bought gold contracts.

Someone mentioned selling naked calls as being very risky. That is a common belief but is not supported by the facts. There are instances, very few instances, where that strategy does yield large losses but in general it is a very rewarding strategy, yielding good returns about 85% of the time.

T-bills yield about the least returns of the sophisticated investments. Savings accounts by far yield the least returns of the un-sophisticated investments. And perhaps whole life policies. And social security contributions. ROI on social security contributions is about a negative 5 to 25%.

Answer 2

Well this answer is probably a little different for each investor. What we mean by "safe and secure" is the variable factor. Some people believe that FDIC insurance means there deposits are "safe and secure" while others who are more inclined to invest in equities or bonds may think that a high dividend paying utility stock is "safe and secure". The sad truth is that where our nation is economically, not even the FDIC can fully insure every dollar on deposit in our banking system. Sure, the federal government can print more money to make every account holder "whole", but the very act of printing that money devalues the dollar further. So regardless what type of saver/investor you may be, we all need to get rid of the notion that our accounts can be fully insured by the government. Whether the FDIC, the SIPC or any other agency will only be able to insure a percentage of our accounts if the system should falter again. With that as my frame of reference, I prefer selecting some quality blue-chip utility companies that are paying a nice dividend. In the telco arena I've got AT&T and Verizon that were both paying in excess of 7% when I purchased them a few months ago. The yield on Verizon has dipped a bit recently as the stock price went on about a 10% price increase in December, however AT&T is only up a couple percent and the dividend is still pretty high. I also picked a water company, WTR, or Aqua America, which is paying me a 5% dividend plus has increased in price another 10% in two months. These types of companies present a win-win opportunity to me. If the price goes up I get the dividend percentage that I locked in when I purchased the stock. If it goes down, that will in turn make the dividend price increase (assuming the company doesn't cut the dividend). I can then buy additional shares at a higher dividend percentage and thereby increase my overall dividend percentage on that particular company. Even if share prices fall 50%, as long as the dividend hasn't be cut, I will continue to earn that 7% per year. That beats the heck out of the 0 - 1% you can get at your local bank. Also, watch the US treasury market. Since QE II was announced by the Fed, treasury rates have increase about 1%. That still doesn't make them a high yield investment in my book, but it does bear watching where the rates are going. All of this stimulus has to end up ultimately causing substantial inflation which will drive treasury rates back up to levels we haven't seen since the 70's. My advice...steer clear for now and stay with high yielding blue chip equities, but keep an eye on the treasury market (which will also increase rates at your local banks as well).

Answer 3

Online HYIP's and Paid to surf programs are the riskiest investments online that I have come across.

The riskiest HYYIP's are those with no contact details. The next riskiest are those paying unsustainable returns. Anything over about 15% a month gets difficult to maintain on a consistant basis for any length of time. Up to 15% is achievable IF the admin investing in industries like Forex or Sports betting with SUCCESSFUL traders or Sports betting experts handling it for them.

I can consistantly get returns of around 20% a month trading Forex myself, and I know of one particular trader who achieves an average of well over 50% profit a month, month in month out, but he is possibly one of the best traders in the world.

Even more risky are the "Paid To Surf" programs. They promise returns of 5 to 15% a day for 10 to 20 days, in exchange for you watching a series of website ads each day. They claim that this is legitamite advertising, but in reality its all based on a Ponzi principle, with new money paying previous investors each day.

Answer 4

The riskiest stuff I've ever dealt in is the FOREX (Foreign Currency Exchange). Quick rewards, or quick losses. I suggest you take a look at some of the articles in 'Investing' and 'Currency Trading' at http://www.hammocksurvivalguide.com/
You should find some useful advice there.

Answer 5

RISK and RETURN go hand-in-hand. The greater the risk an individual is willing to take, the more his expected return to compensate for that risk. Expected return is simply the average return one should receive based on market statistics and risk measures--CAPM. (Expected Return= Risk free rate + (Market Return - Risk free rate)*Beta of stock) This evaluates what you should receive for a given stock.

Now, speaking in terms of typical investments into the equity market, "penny stocks" are by far the most risky. I am not talking about stocks under $5 (because even a few NYSE stocks are under $5), rather speaking of the stocks that trade for pennies on the dollar on the PINKs. They are far more risky because they don't have to fully report to the securities and exchange committe and don't have to submit all fiancial statements. Also, because one may trade at $.01, a move of another penny comes out to a 100% gain/loss!

Speaking outside equities, foreign exchange markets are the most risky due to their highly leveraged trading. There are some places where an investor could receive 200 to 1 leverage. So if you utilized all leverage on say, a $1,000 account---you actually would lose $200,000 if you went bust!

Answer 6

commodities are definately very risky. you should not consider futures, as they are not for the average investor.

any stock that sells for under $5 is a risky investment. they are priced that way for a reason, contrary to some people's beliefs.

as of last week, the industries with the highest % of stocks making new highs are:
oil and gas (50%)
chemicals - fertilizers (27%)
banks - money centers (25%)

i would probably avoid the airline industry until they get their act together...

Answer 7

hedge funds are the riskiest in my opinion

The more risk the more your expected return but the key word there is expected. You don't always get it.

Answer 8

penny stock bullitin board stock anything that you get in any email, or anything that just whent through the roof in value. any investment that you just can't pass up or can't think about and decide tomorrow

Answer 9

Invest in wildcat drilling, if they find oil you make a lot but chances are they won't...

Answer 10

Commodities.