Financial Risk
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A Financial Risk is a risk that affects a financial plan.
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- Example(s):
- See: Financial Risk Modeling, Financial Risk Management, Financial Transaction, Default (Finance), Downside Risk.
References
2016
- (Wikipedia, 2016) ⇒ http://wikipedia.org/wiki/financial_risk Retrieved:2016-4-29.
- Financial risk is an umbrella term for multiple types of risk associated with financing, including financial transactions that include company loans in risk of default. Risk is a term often used to imply downside risk, meaning the uncertainty of a return and the potential for financial loss. A science has evolved around managing market and financial risk under the general title of modern portfolio theory initiated by Dr. Harry Markowitz in 1952 with his article, "Portfolio Selection". In modern portfolio theory, the variance (or standard deviation) of a portfolio is used as the definition of risk.
2016
- (Wikipedia, 2016) ⇒ http://wikipedia.org/wiki/financial_risk_management Retrieved:2016-4-29.
- Financial risk management is the practice of economic value in a firm by using financial instruments to manage exposure to risk, particularly credit risk and market risk. Other types include Foreign exchange risk, Shape risk, Volatility risk, Sector risk, Liquidity risk, Inflation risk, etc. Similar to general risk management, financial risk management requires identifying its sources, measuring it, and plans to address them.