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enlarge on it further, but we will confine
ourselves to the question of the two classes
of In,vestment Risk which may be defined
as follows :—
1. —Diminished Capital.—This disaster
cannot be repaired out of income except
with great difficulty, and in any event such
a calamity must result in impaired capital
safety, if the original rate of income is to
be maintained.
2. —Diminished Income.—This minor
investment inconvenience can always be
rapidly remedied if capital still retains, or
has improved upon, its original value.
In other words, Capital is the tree,
Income is the fruit. The welfare of the tree
must always be the first consideration. In
vestors will do well to permanently fix the
above axioms in their minds, and to be guided
by them in all investment questions.
Having fully grasped the all-pervading
importance of capital, our readers might now
jump to the hasty conclusion that successful
investment simply resolves itself into being
contented with a very moderate income and
investing in nothing but the finest securities.
Unfortunately, however, the quality of the
investments held is not sufficient in itself to
ensure capital safety.