financial risk
Potential monetary loss
Financial risk is the possibility of losing money or failing to achieve expected returns on an investment or business decision.
Banks assess financial risk before lending; investors weigh it against potential reward.
The term covers various threats: market fluctuations, credit defaults, liquidity problems, currency shifts.
The merger carried significant financial risk.
Higher potential returns typically mean accepting greater financial risk.
Rapid, unpredictable changeability
- stocksOwnership stakes or inventory
- commoditiesTradeable raw materials
- indicesOrganized lists for lookup
- tradingExchanging for value
exchange · bullish · bearish · correction · crash · systemic · contagion · black swan
Inability to pay debts
- defaultPreset standard option
- liquidationSelling assets for cash
- foreclosureLender seizes mortgaged property
- restructuringRearranging an existing framework
creditors · debts · receivership · distress · collapse · failure · write-off · liabilities
Ability to repay debts
- defaultPreset standard option
- credit scoreNumerical measure of borrower reliability
- borrowerOne who takes temporarily
- lenderOne who loans money
collateral · repayment · underwriting · rating agencies · delinquency · credit limit · credit report · subprime
Collected works or assets
- diversificationExpanding into varied areas
- equitiesOwnership stakes in corporations
- bondsTies that unite
- securitiesTradeable financial assets
capital · return · yield · asset allocation · shareholder · dividend · speculation · leverage
Spread around the mean
- betaGreek alphabet's second letter
- quantitativeConcerning measurable amounts
- metricsStandards for assessment
- backtestingValidating strategies using history
exposure · weighted · aggregate · factor · benchmark · alpha · covariance · correlation
Money entering and exiting
- solvencyCapacity to pay debts
- convertibilityCapacity for free exchange
- working capitalAssets minus current liabilities
- reservesResources held back
illiquid · fire sale · redemption · margin call · funding · short-term · treasury · current assets
Quantified chance of occurrence
- forecastingEstimating future conditions
- assessmentFormal evaluation of worth
- projectionSomething that extends outward
- estimationApproximate value judgment
contingency · stress test · sensitivity · modeling · actuarial · statistics · unpredictable · variance
volatility
Rapid, unpredictable changeability
- stocksOwnership stakes or inventory
- commoditiesTradeable raw materials
- indicesOrganized lists for lookup
trading · exchange · bullish · bearish · correction · crash · systemic · contagion · black swan · beta
insolvency
Inability to pay debts
- defaultPreset standard option
- liquidationSelling assets for cash
- foreclosureLender seizes mortgaged property
restructuring · creditors · debts · receivership · distress · collapse · failure · write-off · liabilities · solvency
creditworthiness
Ability to repay debts
- defaultPreset standard option
- credit scoreNumerical measure of borrower reliability
- borrowerOne who takes temporarily
lender · collateral · repayment · underwriting · rating agencies · delinquency · credit limit · credit report · subprime · counterparty
portfolio
Collected works or assets
- diversificationExpanding into varied areas
- equitiesOwnership stakes in corporations
- bondsTies that unite
securities · capital · return · yield · asset allocation · shareholder · dividend · speculation · leverage · hedge
standard deviation
Spread around the mean
- betaGreek alphabet's second letter
- quantitativeConcerning measurable amounts
- metricsStandards for assessment
backtesting · exposure · weighted · aggregate · factor · benchmark · alpha · covariance · correlation · percentile
cash flow
Money entering and exiting
- solvencyCapacity to pay debts
- convertibilityCapacity for free exchange
- working capitalAssets minus current liabilities
reserves · illiquid · fire sale · redemption · margin call · funding · short-term · treasury · current assets · cash reserves
probability
Quantified chance of occurrence
- forecastingEstimating future conditions
- assessmentFormal evaluation of worth
- projectionSomething that extends outward
estimation · contingency · stress test · sensitivity · modeling · actuarial · statistics · unpredictable · variance · confidence interval
- riskdownside, product liability, threat assessment, peril, hazard
- entrepreneurship riskventure capital, angel investors, capital loss, burn rate, runway
- exposuresun exposure, light exposure, cold exposure, heat exposure, UV exposure
- D&O Insurancecorporate officers, board members, board member, corporate executives, executive protection
- insuranceinsurance, coverage, auto insurance, life insurance, home insurance
- investmentinvestor, foreign investment, financier, direct investment, backer
financial riskfinancial stability
Sound economic standing
fixed income · capital preservation · predictability · certainty · stability
financial riskfinancial security
Reliable access to funds
safe haven · risk mitigation · financial protection · security · safety
risk, finance, risky, risked, finances, financial, risks, risking, riskiness