market risk

Definition

Risk which is common to an entire class of assets or liabilities. The value of investments may decline over a given time period simply because of economic changes or other events that impact large portions of the market. Asset allocation and diversification can protect against market risk because different portions of the market tend to underperform at different times. also called systematic risk.

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Related Terms

beta, portfolio theory, portfolio insurance, unsystematic risk

'market risk ' appears in the definitions of these terms on BusinessDictionary.com

collar agreement, credit derivative (CD), principal basis, value at risk (VAR), market maker

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