Describe the factors that need to be considered before making an investment

All investments involve some degree of risk. If you intend to purchase securities - such as stocks, bonds, or mutual funds - it's important that you understand before you invest that you could lose some or all of your money. ... The reward for taking on risk is the potential for a greater investment return.

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Sample response below.

Explanation:

The three factors that need to be considered before making an investment are liquidity, risk, and return. Liquidity is how easy it will be to convert the investment into cash. The amount of risk depends on the degree of possibility that the investor will lose their investment. The return is the amount of earning potential that the investment offers. Risk and return go in the same direction; the greater the risk the greater the earning potential.

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