It is a generally accepted principle of investing that you must assume more risk to achieve a greater return on investment, or ROI. This is called the risk-return ratio. If you are willing to accept more risk, your return-on-investment should also go up. Whenever you invest, however, there is also a risk that your investment will drop in value or that you won’t make a dime.

While there are many investments, like savings accounts, that produce a modest return with almost no risk, younger investors usually benefit in the long run from seeking a greater return-on-investment by including higher risk investments in their portfolios, such as stocks or mutual funds that invest in stocks. This is because younger investors have more time to take advantage of the power of compound interest and to recover from the losses that will inevitably occur along the way. For example, while money invested in the stock market can lose value in a given year and pay less than money deposited in savings account, there has never been an 18 year period in which stocks have not done better than savings accounts; and, in most 18 year periods, they have done much, much better.

Remember, though, that taking reckless chances with your money isn’t investing; it’s gambling. When you invest, you should understand the potential advantages and disadvantages of each investment and use time-tested strategies that give you legitimate opportunities to succeed.