Risk Terms
Market Risk
Definition
What is Market Risk?
The possibility of loss because broad market prices or rates move against an investment.
Example in practice
How This Looks in Practice
A broad stock-market decline reduces the value of many shares held by an equity fund.
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Related Terms
Risk Terms
Credit Risk
The possibility that a borrower or issuer will fail to make promised payments or suffer a downgrade.
Risk TermsInterest-Rate Risk
The possibility that changing market interest rates will reduce an investment's value or income appeal.
Risk TermsLiquidity Risk
The risk that an asset cannot be sold quickly at a reasonable price or a redemption cannot be met promptly.
MiscellaneousBusiness Day
A day on which relevant financial institutions and markets are open for normal processing.