Understanding your Cost of Production

By: Daniele Ricci

Risk management is the name of the game. If you know your Cost of Production (COP), your risk management strategy can set you up to preserve three things: liquidity, equity for future investments and equity for retirement.

Markets are constantly going up and down. If you set risk management levels to cover your cost of production, the hills and valleys of the markets shouldn’t feel like such a drastic swing.

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