MR. WATSON: What kind of risk does a variable annuity have? Market risk.

MR. WATSON: What kind of risk did a fixed annuity have?

ALL: Inflation risk.

MR. WATSON: Let's talk about a vertical pole of risk, if you want to call it that.

MR. WATSON: On the bottom down here, you have fixed annuities. What's the problem with a fixed annuity? Inflation risk. Do y'all agree?

STUDENTS: Yes.

MR. WATSON: So a guy up here with a variable annuity, what kind of risk does he have?

STUDENTS: Market risk.