Which of the following statements is true about speculative risk?

Speculative risk is characterized by the potential for both gain and loss, making the statement that it involves a chance for both gain and loss accurate. This type of risk is typically associated with investments or business ventures, where outcomes can yield profits or losses, reflecting its dual nature. Unlike pure risks, which only present the possibility of loss and are usually insurable (for example, risks related to health or property damage), speculative risks are not insurable because they involve the potential for positive outcomes as well. Understanding this distinction is crucial in risk management and the insurance industry, as it helps differentiate between risks that can be covered by insurance policies and those that cannot.