Idiosyncratic Risk

0.02 sec.

Idiosyncratic Risk

Unsystematic risk or risk that is uncorrelated to the overall market risk. In other words, the risk that is firm-specific and can be diversified through holding a portfolio of stocks.

Nonsystematic Risk

Risk that is unique to a certain asset or company. An example of nonsystematic risk is the possibility of poor earnings or a strike amongst a company's employees. One may mitigate nonsystematic risk by buying different of securities in the same industry and/or by buying in different industries. For example, a particular oil company has the diversifiable risk that it may drill little or no oil in a given year. An investor may mitigate this risk by investing in several different oil companies as well as in companies having nothing to do with oil. Nonsystematic risk is also called diversifiable risk. See also: Undiversifiable risk.

How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content.

?Page tools

Printer friendly
Cite / link

Feedback
Add definition

Mentioned in	?		References in periodicals archive	?		Financial browser	?		Full browser	?
Specific Return Unique risk			Holding only one or two currency pairs would invite considerable idiosyncratic risk (or risk related to those few pairs held); so traders create portfolios of various carry trade pairs to diversify risk from any single pair and isolate exposure to demand for yield. Risk Appetite Stalls But the Dollar and Dow Maintain Trend Through ... by Mena Report Finally, high finance allows for portfolio diversification, so that individual investors can seek high-expected returns without being forced to assume large, idiosyncratic risks of bankruptcy and poverty. Hidden Games of High Finance by Khaleej Times (Dubai, United Arab Emirates) Finally, high finance allows for portfolio diversification, so that individual investors can seek high expected returns without being forced to assume large, idiosyncratic risks of bankruptcy and poverty. The hidden purposes of high finance by Daily News Egypt (Egypt)			Ice Clause Iceberg Order Iceland Stock Exchange Icelandic Krona ICI ICMS ID IDA IDC Ideal Capacity Ideal Point Model idem sonans Identical Goods Identical Reciprocity Identical Treatment Identification Problem Identified Renewal Identified Shares Identified Transaction Identify Shares Identifying Numbers Identity Theft Identity Theft and Assumption Deterrence Act of 1998 Identity Thief IDIN Idiosyncratic Risk Idiot Card Idle Idle Capacity Idle Funds Idle Time Idou Heikin Idou heikin Shusoku Hassan Hou IDR IE IEA Petroleum Reserves IEP IFC IFO Business Climate Index IFRS IHS Global Insight Iirudokaabu Ijara Wa Iktina Ijarah Iji Shoukokin IL ILEC Iliquidez Illegal Act Illegal Alien Illegal Contract			Idiospermum Idiospermum australiense idiostatic connection Idiostolidae Idiosyncracies Idiosyncracies Idiosyncracies Idiosyncracies Idiosyncracy Idiosyncracy Idiosyncracy Idiosyncracy idiosyncrasies idiosyncrasies idiosyncrasies idiosyncrasies idiosyncrasy idiosyncrasy idiosyncrasy idiosyncrasy idiosyncratic idiosyncratic idiosyncratic idiosyncratic Idiosyncratic Adverse Drug Reaction idiosyncratic drug effect Idiosyncratic reaction Idiosyncratic reaction Idiosyncratic Return Idiosyncratic Returns Idiosyncratic Risk Idiosyncratic Risks idiosyncratical idiosyncratically idiosyncratically idiosyncratically idiosyncratically idiot idiot idiot idiot idiot idiot idiot Idiot At Keyboard Idiot Behind Keyboard Idiot board Idiot board idiot boards idiot box idiot box Idiot box (disambiguation) idiot boxes idiot card idiot card idiot cards idiot cards Idiot exploiter Idiot exploiter Idiot exploiter Idiot fruit

Financial Dictionary

Free Tools:	For surfers: Free toolbar & extensions \| Word of the Day \| Help For webmasters: Free content \| Linking \| Lookup box \| Double-click lookup \| Partner with us

Disclaimer
All content on this website, including dictionary, thesaurus, literature, geography, and other reference data is for informational purposes only. This information should not be considered complete, up to date, and is not intended to be used in place of a visit, consultation, or advice of a legal, medical, or any other professional.