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| Business or Finanicial Risk |
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Definition
| The risk that the business in which you have invested money will not do well. |
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| A risk that applies with debt securities (bonds). The investor has extended credit to the issuer when he buys their bonds. This is the risk that the issuer will be unable to pay the investor back. |
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| The risk that an investment cannot be easily liquidated or sold. |
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| The uncertainty that a particular security may fluctuate in price solely due to incvestor sentiment in the market. Sometimes called systematic risk. |
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| The sensitivity of an investment's price or value to fluctuations in interest rates. |
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| Purchasing power or inflation risk |
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Definition
| The uncertainty that a dollar will not purchase as much in the future as it does now. This risk is found in all fixed dollar securities such as bonds and fixed annuities. |
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| The risk that a purchaser of a fixed income security incurs that interest rates will be lower when the purchaser seeks to reinvest income received from the security. |
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| The potential for an investor to lose all his Money (invested capital)under circumstances either related or unrelated to an issuer's financial strength. |
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| The risk that a change in law might affect an investment adversely. Also known as Political Risk. |
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| The risk that a bond might be called before maturity and investors cannot reinvest their principal at the same or a higher rate of return. |
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| The risk to an investor of buying or selling at the wrong time and incurring losses or lower gains. |
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| The risk that foreign currency will decline in value. Also known as exchange risk. |
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