Which category of risk has outcomes including loss, break even, or gain?

Speculative risk refers to situations where the outcomes can be either a loss, a break even, or a gain. This type of risk occurs in scenarios where there is potential for profit or loss, such as investing in stocks or starting a new business. Investors who take on speculative risks do so with the understanding that they could either experience a financial gain or incur a loss, making it distinct from other risk categories that do not have the potential for positive outcomes.

In contrast, fundamental risk deals with risks that are widespread and affect large groups of people or entire communities, such as natural disasters. Particular risk is associated with individual units or specific situations and generally involves pure risks—those resulting only in loss or no loss. Pure risk, for instance, involves scenarios where there is a possibility of a loss or no loss, with no opportunity for gain. Thus, speculative risk stands out because it involves outcomes that include all three possibilities: loss, break even, or gain.