Investment Risks

What is market risk?

• Market risk is the potential for losses in investments due to factors such as changes in government regulations and tax policies.
• Market risk is the potential for losses in investments due to factors such as economic conditions, market volatility, and changes in interest rates.
• Market risk is the potential for losses in investments due to factors such as political instability and currency fluctuations.
• Market risk is the potential for losses in investments due to factors such as changes in consumer preferences and technological advancements.

If interest rates change, what kind of risk might affect your investments?

• Inflation risk
• Interest rate risk
• Credit risk
• Market risk

Which risk is like lending money to a friend who might not be good at paying back?

• credit risk
• liquidity risk
• market risk
• default risk

What risk is related to the overall performance of financial markets?

• market risk
• operational risk
• credit risk
• systematic risk

What is the risk of your money slowly losing its buying power over time?

• inflation
• deflation
• interest rates
• stock market volatility

Which risk is like having a special toy that's hard to trade with others?

• market risk
• liquidity risk
• operational risk
• credit risk

If a government makes new rules that affect a company, what kind of risk is this?

• regulatory risk
• financial risk
• operational risk
• legal risk

What type of risk can be reduced by having different types of investments?

• Market risk
• Credit risk
• Liquidity risk
• Diversification

Which risk is about the risk of losing money if a company or government doesn't pay back their debt?

• credit risk
• operational risk
• market risk
• liquidity risk

If the value of money in different countries changes, what kind of risk is this?

• interest rate risk
• inflation risk
• currency risk
• exchange risk