According to Ritter, Silber and Udell (2004), "financial markets are basically the same as other kinds of markets. People buy and sell, bargain and haggle, win and lose, just as in the flea markets of Casablanca and Amsterdam or the gold markets of London and Zurich. In financial markets, they buy and sell securities, like stocks and bonds, which are less tangible than hot bracelets or cold gold bars but are no less valuable" (p.31). Regardless of the type of investment that the investor chooses, there will unavoidably experience some level of risk. Being able to understand the types of risks associated with certain investment is important to understand how risky and investment is, which can be helpful to the investor in selecting the right investment. Risks are generally divided into two broad categories: high risk and low risk. The goal of this research paper is to identify and compare and contrast the advantages and disadvantages of investing in high risk or low risk investment and to determine what one needs to consider when creating a portfolio.