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What Is the Due Diligence Period in Real Estate?

What Is the Due Diligence Period in Real Estate?

Whether you’re buying real estate for investment or to live in, you’re putting money into that property. A lot of money. You don’t want to inherit a seller’s problems when you buy.

Jun 21, 2022

What Is Downgrade Risk?

What Is Downgrade Risk?

Downgrade risk affects both bond and equity investors. Different entities issue ratings for bonds and stocks. But the net effect of a downgrade is similar for both bonds and stocks. Investors who hold either of these investments are always exposed to downgrade risk. In this article, we’ll discuss what downgrade risk is.

Jun 20, 2022

Can Unsystematic Risk Be Reduced or Eliminated?

Can Unsystematic Risk Be Reduced or Eliminated?

Unsystematic risk is the flip side of the two primary risks investors face. The other risk is called systematic risk. Understanding the difference between these two risks means understanding why some risks can’t be reduced/eliminated from a portfolio while other risks can.

Jun 18, 2022

What Is Currency Risk?

What Is Currency Risk?

Globalization and the internet have expanded investment opportunities. Depending on your investment appetite, you could invest in a German broad market index or tap into an authorized agent to acquire a United Kingdom government bond.

Jun 17, 2022

What Is Inflation Risk?

What Is Inflation Risk?

Several things occurred in 2021. COVID-19 variants continued to mutate and spread, even as vaccines were more available. Climate change generated extreme weather events worldwide, from raging storms to drought to wildfires. And inflation in the United States pushed to a 40-year high.

Jun 16, 2022

What Is the Difference between Systematic and Unsystematic Risk?

What Is the Difference between Systematic and Unsystematic Risk?

Managing your exposure to risk is an important aspect of investing. Every type of investment carries some degree of risk, and reducing your exposure to the factors that can negatively impact your investment capital could be the difference between red or black ink on your balance sheet.

Jun 15, 2022

What is Financial Risk Analysis?

What is Financial Risk Analysis?

The risk of losing money is an inherent aspect of investing. The process of assessing and measuring risk to determine an investment’s potential viability, as well as coming up with ways to potentially mitigate certain risk factors, is called a financial risk analysis or financial risk assessment.

Jun 14, 2022

What Is Reinvestment Risk?

What Is Reinvestment Risk?

Let’s say you’re an investor with a portfolio of bonds, and one of those bonds is nearing its maturity date. Thanks to the relatively high interest rate attached to that bond when you first invested in it, you’re looking forward to reinvesting in the same bond at the same class.

Jun 10, 2022

What Is Commodity Risk?

What Is Commodity Risk?

Commodity risk most commonly refers to price fluctuations for raw materials like steel, wood, gas, grains, coffee, and similar products. Price changes in either direction comprise a risk: a price increase is a risk for commodity buyers who use the materials to create their products. But for commodity producers, a price decrease is a risk. For example, if your company needs lumber to build homes or other products, the price increase can be a considerable risk. On the other hand, if reduced demand results in a price decrease, sellers (producers) risk losses.

Jun 8, 2022

What Is an Event Risk?

What Is an Event Risk?

Event risk is the risk of a negative effect on a company’s value that results from an unexpected event. The event may threaten its ability to operate or its financial well-being. Events can be internally instigated, like a restructuring, an acquisition, or a product launch. Events can be externally caused, like a computer virus or a natural disaster. The event may affect just the specific organization or may be far-reaching.

Jun 4, 2022

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Discover Ways To Help Manage Risk In Your Investment Portfolio

Discover Ways To Help Manage Risk In Your Investment Portfolio
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