Financial price risk

Financial price risk

The chance there will be unexpected changes in a financial price, including currency (foreign exchange) risk, interest rate risk, and commodity price risk.

Financial Price Risk

The risk that the price of something will change significantly such that it results in a loss. For example, if one has an investment in a foreign currency and that currency changes in value, it may adversely affect the investment's value. Likewise, if one holds a long position in a commodity and the price crashes for any reason, one may take a loss. Financial price risk can be mitigated by any number of hedging strategies, but these almost always limit returns.
References in periodicals archive ?
Koch Supply & Trading's participation will primarily involve developing and offering financial price risk management services for flat-rolled products to producers, service centers, converters, end-users and vested financial institutions," said Jeff Kabel, vice president of steel trading.
Paulsen helped spearhead the development of a financial price risk management business for petrochemicals and plastics.