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  • Tuesday, April 29, 2025
  • The Financial Encyclopedia
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Currency Risk

The risk that arises from potential fluctuations in the fair value (FV) or future cash flows of a financial instrument...

    Stub Risk

    The risk that arises because of the duration of the floating leg of a swap. This occurs because once the...

      Default Risk

      Generally speaking, it is the possibility that firms or individuals would fail to honor their contractual obligations on their borrowed...

        Cross Hedging Risk

        The risk that arises in case of hedging an asset with another using futures while the two are not identical...

          Bona Fide Hedge

          A hedging transaction that meets a host of conditions for qualification as bona fide hedge. The transaction must (1) represent...

            Horizontal Risk

            The risk that arises from inability of a hedger/ portfolio manager to hedge against a change in the shape of...

              Yield Curve Risk

              The risk that arises from inability of a hedger/ portfolio manager to hedge against a change in the shape of...

                Curve Risk

                The risk that arises from inability of a hedger/ portfolio manager to hedge against a change in the shape of...

                  Interest Rate Risk

                  Generally, it is the risk that arises from changes in interest rate which impact the value of interest-bearing securities/ investments...

                    Riskless Bond

                    A bond that is associated with no risk (credit risk, default risk) over its term or time to maturity. In...