The National Association of Securities Dealers issued an Investor Alert today to remind investors that market risks are just as important to consider as specific business risks when evaluating investments.

The alert outlines the various types of market risks investments may be exposed to and describes the steps investors can take to minimize those risks. It explains that common market risks are dependent on the nature of the investment and may involve international, as well as domestic, factors. The alert is being published for investors around the world through the efforts of the International Organization of Securities Commissions.

“Assessing risk can be a daunting task for any investors, especially with the increasing globalization of financial markets,” said Elisse Walter, NASD senior executive vice president. “By issuing this Alert, we hope more investors will better understand market risks before investing and take the necessary steps to manage those risks.”

The alert explains that while investors cannot completely avoid market risks, investors can help mitigate certain risks by diversifying their investments — not just at the product or sector level, but also in terms of region (domestic and foreign) and length of holdings (short- and long-term). It also explains that by selecting investments that are less likely to fluctuate with changes in the market, investors can help minimize risks to a certain extent.