Most people hear "risk" and think "danger — avoid it." In investing, risk means something more specific: the possibility that your investment performs differently from what you expect.
Risk has two sides. The downside risk is that your investment loses value. The upside potential is that it gains more than expected. You cannot have one without the other.
During March 2020, the MSCI World Islamic Index fell about 28% in a matter of weeks. By the end of 2020, it had fully recovered and was up roughly 15% for the year. Investors who sold in March locked in their loss. Investors who held steady recovered everything.
In Islamic finance, risk is not considered bad in itself. The prohibition of riba exists precisely because riba eliminates risk for the lender — they are guaranteed a return regardless of outcome. Halal investing requires real risk because it requires real shared ownership. Gharar, or excessive uncertainty, is prohibited — but normal business risk is not.