Saving, Managing Debt, and Budgeting

Risk / Reward

What is “market risk”?

Market risk is an investor’s risk in incurring losses due to price movements. There are many types of market risks, as there are many different markets in which we can invest. Some of the most common risks include: Equity Risk (the risk that an individual stock, index, or mutual fund price or the volatility of that investment may change); Interest Rate Risk (the risk that interest rates, the price of money, or the volatility of these categories may change); Currency Risk (the risk that the price of a foreign currency relative to another currency, or the volatility of this price, may change); Commodity Risk (the risk that the price of a particular commodity a company uses, or the volatility of the price of this commodity, may change).


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