What is one of the main risks associated with stocks?

The main risk associated with stocks is that the company could fail. When an investor purchases shares in a company, they are essentially buying a piece of that company's ownership. If the company encounters significant problems—such as poor management decisions, loss of market share, financial mismanagement, or extreme economic downturns—it may lead to bankruptcy. In such cases, the value of the stocks can plummet, and investors may lose their entire investment, especially if the company goes bankrupt and shareholders receive little to no compensation.

This risk emphasizes the importance of researching and analyzing companies before investing, as understanding the fundamentals of a business can help investors make informed decisions. Stocks are often viewed as higher-risk investments compared to fixed-income securities, as their value is heavily reliant on the performance of the underlying company.

The other choices refer to concerns that are less fundamental to the nature of stock investing. Missing out on dividends, for instance, is a consideration but not a direct risk; companies are not required to pay dividends, and missing them is more about investment strategy. While some stocks require a higher initial investment compared to others, this does not apply to all stocks and is not a risk of losing money. Lastly, there are no maintenance costs associated with owning stocks, though investors should