Systemic Risk

(redirected from Market Risks)

Systemic Risk

Risk common to a particular sector or country. Often refers to a risk resulting from a particular "system" that is in place, such as the regulator framework for monitoring of financial_institutions.

Systemic Risk

A risk that is carried by an entire class of assets and/or liabilities. Systemic risk may apply to a certain country or industry, or to the entire global economy. It is impossible to reduce systemic risk for the global economy (complete global shutdown is always theoretically possible), but one may mitigate other forms of systemic risk by buying different kinds of securities and/or by buying in different industries. For example, oil companies have the systemic risk that they will drill up all the oil in the world; an investor may mitigate this risk by investing in both oil companies and companies having nothing to do with oil. Systemic risk is also called systematic risk or undiversifiable risk.
References in periodicals archive ?
ENPNewswire-July 31, 2019--FDIC Annual Publication Examines Potential Credit and Market Risks
Thomsett, a market specialist, author, speaker, and coach, offers a guide to getting started in derivatives trading, with a focus on the attributes of strategies, market risks, and the expanding uses of options and the use of options to hedge market risks in an equity portfolio.
"The amount of regulatory capital models-based banks will need to cover potential market risks following the revisions is uncertain.
Their capital markets have been vulnerable to external market risks and experienced a severe currency crisis in 1997 as well as a recent financial crisis in 2008 after market liberalization.
When an immediate annuity is purchased, the consumer (or annuitant) is transferring longevity and market risks to an insurance company that is more efficiently equipped to manage the risks.
Marketing risk identification is probably derived from the identification of market risks in general and designing of their management schemes.
The second and final day of the summit will open with a session considering lenders' perspectives on biodiesel financing, followed by sessions titled "Biodiesel Deal Structures," "The Market Risks in Biodiesel Deals," "Hedging Market Risks" and "EPC Contractors' Perspectives on Biodiesel Deals."
bank holding companies with large trading operations have been required to hold capital sufficient to cover the market risks in their trading portfolios.
This pressures senior management to ensure that financial management methods are in place to optimize returns on capital employed commensurate with the risks taken--from insurance, credit and market risks to operational and strategic risks.
Martin Morgan, CEO of DMG Information, said: "The acquisition of PPR will for the first time permit general market risks by property type and geographical area provided by PPR to be evaluated simultaneously with property specific risks provided by EDR.
As such, mortgage companies exhibit varying approaches, degrees of sophistication and technological capabilities in measuring and managing the market risks posed by their disparate, nonstandard asset classes.