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The term "risk" is used interchangeably with "volatility" to refer to the variability of returns associated...

The term "risk" is used interchangeably with "volatility" to refer to the variability of returns associated with a given asset. (T/F)?

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Answer #1

The term "risk" is used interchangeably with "volatility" to refer to the variability of returns associated with a given asset.

This statement is true.

Risk is the possibility of loss which an investor analyses before making any investment with respect to its return. Volatility is the fluctuation in the return from its average or mean. Both terms are used to determine the uncertainty association with the returns with a given asset therefore they are used interchangeably.

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