For example, entering into an extensive position in a stock has restricted possibility because the investor can lose no more than
the initial amount invested.
The risk of an investment that has predetermined maximum downside potential, which is usually
the initial amount invested.
A deferred annuity that permits allocations to stock or bond funds and for which the account value is not guaranteed to stay above
the initial amount invested is called a variable annuity.
With a single life annuity, the income stops when you die, and
the initial amount invested belongs to the insurance company.
A deferred annuity that permits allocations to stock or bond funds and for which the account value is not guaranteed to stay above
the initial amount invested is called a variable annuity (VA).