Are there any disadvantages of investing in risk-free instruments?
Curious about risk-free investment
One of the major disadvantages of investing in riskfree instruments is that the returns are typically lower than other types of investments. Riskfree investments are designed to be stable and secure, which means that the returns are generally modest. Additionally, riskfree investments may not offer the same potential for capital appreciation that other investments might. Another disadvantage is that inflation risk can erode the purchasing power of the invested amount over time. Finally, there may be limitations on the liquidity of some riskfree investments, meaning that it may be difficult to access your funds if you need them quickly.