Gap Risk

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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 ?
The digital gap risks becoming a chasm with AI set to transform the face of UK businesses.
This is because market moves are generally without the gap risks thatare present in some other markets.
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.