What type of investment typically carries the least amount of risk?

Treasury securities, often referred to as government bonds, are issued by the U.S. Department of the Treasury and are backed by the full faith and credit of the U.S. government. This backing significantly reduces the risk associated with these investments, making them one of the safest options available. The likelihood of default on Treasury securities is extremely low, as the government has the ability to raise funds through taxation and has historically never failed to meet its obligations in repaying debt.

In contrast, stocks can experience fluctuations in value due to market forces and company performance, which introduces a higher level of risk. Corporate bonds, while generally safer than stocks, still carry credit risk as they rely on the issuing company's ability to repay the debt. Real estate investments carry risks related to market conditions, property management, and liquidity, making them more volatile and uncertain compared to Treasury securities. This comprehensive understanding of risk helps clarify why Treasury securities are typically viewed as the least risky investment option.