Price risk

Price risk

The risk that the value of a security (or a portfolio) will decline in the future. Or, a type of mortgage pipeline risk created in the production segment when loan terms are set for the borrower in advance of setting terms for secondary market sale. If the general level of rates rises during the production cycle, the lender may have to sell the originated loans at a discount.

Price Risk

The risk of loss that occurs if the value of a security or portfolio falls below the price one paid to buy it.
References in periodicals archive ?
As states deregulate their electric utilities, most are decoupling power production from distribution, with the result that distributors are becoming mega-purchasers of power and are more exposed to power price risk than any other industry.
I was once involved in a transaction where the client had agreed on a programme to hedge the price risk associated with anticipated monthly exports of approximately 180,000 barrels of crude oil from a particular field.
"Customers are increasingly accessing the deep liquidity across our energy markets to manage price risk during this time of increased volatility and uncertainty," said Peter Keavey, CME Group Global Head of Energy.
Project Objectives: The overall objective of the project is to provide cocoa smallholder farmers with the capacity to tackle appropriately their exposure to cocoa price risk. Project Status: The project agreement was signed by CFC, ICCO and TWIN (the PEA) in March 2014 and the PEA signed the contractual agreement with each National Project Implementing Agency (NPIA) for the project implementation.
The rater expects that the coal price risk will increase over the next 12 months as domestic steel mills continue to trim capacity amid dwindling demand and the economic slowdown.
Press was previously with BHP Billiton, where he was responsible for all energy coal positions globally, including price risk management and trading, the company said.
The guide covers: financial risk, both internal and external; personal or human risks; production risks including weather, climate, disease and pests, as well as equipment, labour and operational issues; marketing or price risk; and finally institutional risk which includes all the external constraints and incentives society places on farmers.
The New York Board of Trade (NYBOT) will be co-producing along with Tea & Coffee Trade Journal a roundtable discussion with coffee industry leaders on managing price risk associated with buying green coffee.
Certainly, investors in CMBS must price risk more effectively.
* Permitting hedge accounting for price risk exposures of future positions that in all likelihood will materialize.
Changing these rules could profoundly affect companies that extensively hedge interest-rate risk, commodity price risk or foreign-currency risk associated with anticipated but not firmly committed future transactions.
Allstate has roughly 1M policyholders that are using its app or plug-in device, representing about 5% of its customer base, he notes, adding he expects this number to more than double in the coming 18 months, which will provide Allstate with enough data to extrapolate predictive analytics across its entire portfolio to price risk more accurately.