In general, which group of investments tends to be higher in risk?

Investing in equities, or stocks, is typically associated with a higher level of risk compared to bonds, government securities, or debentures. This heightened risk is primarily due to the inherent volatility in the stock market, where share prices can fluctuate significantly based on various factors, such as market conditions, company performance, economic indicators, and investor sentiment.

Equities represent ownership in a company, which means that investors are subject to the company's business performance. If the company performs well, the stock price may rise, providing substantial returns. Conversely, if the company encounters challenges or market conditions worsen, the stock price can decline sharply, leading to potential losses for investors. This variability is a key reason stocks are considered higher-risk investments.

In contrast, bonds, especially government securities, are generally viewed as safer investments. They provide fixed interest payments and return the principal at maturity, making them more stable and predictable. Debentures, while they carry some risk, do not typically match the level of volatility and potential loss that can occur with equities. Thus, focusing on risk profiles, equities represent the group of investments with higher risk exposure compared to the other options listed.