Risk affected by governmental actions that will have a negative effect on a trader’s position.
Political Risk
Related Terms
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Risk sentiment is a term used to describe how financial market participants (traders and investors) are behaving and feeling. What traders choose to buy or sell means balancing how much they are prepared to lose with how much they hope to earn. You can look at risk sentiment as the expression of traders’ and investors’ willingness to […]
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A binary option is a type of options contract in which the payout will depend entirely on the outcome of a “Yes or No?” or “True or False” proposition. Don’t be intimidated! Its name may sound complicated, but binary options are arguably a simpler way to trade than traditional options or currencies. Just like traditional […]
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NIRP stands for “negative interest rate policy”. NIRP is a macroeconomic concept that describes conditions characterized by negative nominal interest rates. It’s when central banks resort to...
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RORO stands for “Risk On, Risk Off”. RORO describes a market environment where price behavior responds to and is driven by, changes in risk tolerance by investors and traders. The change in risk...
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A mortgage-backed security (MBS) provides investors with a monthly pro-rata distribution of any principal and interest payments made by homeowners. Types of MBS Pass-throughs In a pass-through MBS,...