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What are the types of financial risks?

帮考网校2020-10-12 15:51:27
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There are several types of financial risks, including:

1. Credit risk: The risk of default on debt payments by borrowers.

2. Market risk: The risk of losses due to changes in market conditions, such as interest rates, exchange rates, or stock prices.

3. Liquidity risk: The risk of not being able to sell an asset quickly enough to meet financial obligations.

4. Operational risk: The risk of losses due to inadequate or failed internal processes, systems, or human errors.

5. Reputational risk: The risk of negative impact on a company's reputation due to actions or events.

6. Legal risk: The risk of losses due to legal action or regulatory compliance failures.

7. Systemic risk: The risk of a widespread financial crisis due to the interconnectedness of financial institutions and markets.
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