Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
An investment vehicle in which the maximum amount one may lose is the initial amount of the investment. An example is a long position on an option contract. If one does not exercise the option, the most one may lose is the premium. Likewise, a limited partner in any partnership is only liable for the amount of his/her investment in the event of liquidation.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved