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An investment is a risk and you have to determine how much of a risk you're willing to take. Are you a risk taker who is willing to risk large sums of money in order to earn even more? Are you a person who is not much of a risk taker? Those who are not big risk takers are those individuals who tend to invest in safer stocks that do not gain as quickly as those high risk stocks. Nevertheless, they may not experience the losses that risk takers have the potential to experience.

You also have to ask yourself if you're into short-term investments or long-term investments. Short-term investments tend to be higher risk investments. If you want to invest cash and get a return as soon as possible, then short-term investments are going to be your best bet. If you want to invest cash and let it gain over the long term, which tends to be low risk, then you can do that as well. Just know that strategies for long-term investments differ from strategies used in short-term investments.

Basically, you're going to be able to better judge your risk tolerance by looking at what type of person you are. Sure, it is attractive to be able to gain money in the short-term, but how will you handle it emotionally and financially if you lose money? That is something you need to consider because you don't need stress on yourself or your wallet if it is not necessary.

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