How do risk-free investments differ from low-risk investments?

In general, riskfree investments are considered to have a very low risk of loss, while lowrisk investments may have a slightly higher risk of loss, but also offer the potential for higher returns.

Riskfree investments typically have a lower return compared to other types of investments, but are considered to be very safe and stable. Examples of riskfree investments include government bonds and fixed deposits with banks, as they are backed by the government or financial institution, respectively.

On the other hand, lowrisk investments, such as mutual funds or exchangetraded funds (ETFs) that invest in highquality corporate bonds or bluechip stocks, may have a slightly higher risk of loss, but also offer the potential for higher returns than riskfree investments.

It's important to note that risk tolerance and investment goals can vary for different individuals, so what may be considered a lowrisk investment for one person may not be the same for another. It's always recommended to consult with a financial advisor or do thorough research before making any investment decisions.