Have you considered the trade-off between risk and return when making an investment? Did it change your investment? Do you expect a risk premium related to the level of risk?
Personally, I have not had much experience with making investments so I have little consideration on the trade-off between risk and return. However, my limited experience defiantly evaluates that. When my husband and I were deciding to buy a house we had the option of staying in town in a deed restricted neighborhood, or buying a home further away but with a more traditional investment. Deed restricted puts a cap on what you can sell your home for. For us, we choose to buy out of town with the option of having a better investment. In this particular case I do not think a premium related to the level of risk applies, however, I do think this applies to many investments.
Why is the present value of a dollar more valuable than its future value?
The present value of a dollar is more valuable than its future value because of variables related to interest rates and inflation. Having the dollar now is an assurance, and the dollar in the future has some unpredictability.
Principles of Macroeconomics Spring 2020 