What is a defining characteristic of high-risk investments?

High-risk investments are typically characterized by their potential for significant price fluctuations and the possibility of large returns or losses. Options like stocks and futures fall into this category because they can experience dramatic changes in value based on market conditions, economic factors, and investor sentiment.

Investing in stocks can yield high returns, especially in a bullish market, but they are also susceptible to downturns. Futures contracts can lead to substantial gains if the market moves in your favor, but they also carry the risk of large losses if the market turns against the position. Thus, the inclusion of these options showcases the essence of high-risk investments—they are tied to significant volatility and uncertainty, which may appeal to those with a higher risk tolerance looking for potential high rewards.