Absolutely, mutual funds and all investments assume some level of risk because to keep it in cash means losing money to inflation. There would be way smaller a

Absolutely, mutual funds and all investments assume some level of risk because to keep it in cash means losing money to inflation. There would be way smaller and more risk averse pool of investment capital if the dollar were deflationary. For example many portfolios whose goal is wealth preservation buy municipal bonds which fund public works projects(and certainly have a non-zero risk of default).