Gap Risk

Gap Risk

The risk that a stock will fall dramatically in price from one trade to the next. For example, gap risk is the possibility that one will lose on an investment if a stock falls from, say, $120 to $95 per share in a single trade. This only occurs when there is a significant and sudden drop in demand for the stock.
References in periodicals archive ?
With the broader and larger investor base that is caused by the MSCI upgrade, equities in the UAE and Qatar are likely to see greater average daily trading volumes, decreased average volatility, decreased gap risk, more resilience to internal and external shocks or black swan events and greater transparency.
Another risk that must be addressed on this stage is the performance gap risk, which is in the form of forced interruptions (i.
Thus, to the extent that the mezzanine lender is amenable to accepting a policy with an effective date prior to the making of its loan (and with the attendant gap risk for matters arising in the interim), that option is available and the cost would be for the endorsement only, as the policy would have been previously issued and paid for.
Passengers who aren't mindful about the gap risk harmful or even lethal consequences.
Models are almost inevitably less volatile than reality because it is difficult to factor in gap risk and behavioral response.
And, to help reduce Gap Risk, documents should be recorded with their county recorder immediately after closing.
Best's concerns that the risk-based capitalisation for L&G may further deteriorate in the event of a further fall in asset values and a decrease in the long-term yields, which will heighten the assets and liabilities' gap risk.
Residual gap risk with respect to cash settlements is managed through the use of default swaps.
This is because market moves are generally without the gap risks thatare present in some other markets.
Internal audit can play a key strategic role in assessing programs -- such as recruiting and retention initiatives, HR IT systems, and deployment of data analytics capabilities to monitor trends -- designed to mitigate the anticipated talent shortage and skills gap risks.
The threat to chemicals, among the most energy-intensive industries, shows how the widening cost gap risks inflicting further pain on a UK industrial sector that's yet to recover from the financial crisis.
2 billion -- the largest in history -- grows over time, the gap risks widening even further between those with opportunity and those without.