The amount of money you're able to accept losing as an investor is called your "risk tolerance." Risk tolerance is the degree of uncertainty and financial loss an investor is willing and able to take in exchange for potential higher returns. It varies based on factors such as investment objectives, time horizon, financial situation, and personality. Investors with higher risk tolerance are open to potentially bigger losses and higher returns, often investing in stocks, while those with lower tolerance prefer safer investments like bonds. Risk tolerance helps determine the kinds of investments selected and how much volatility and loss one can handle in their portfolio without undue stress or financial hardship.
