Presented By:-

Vishal Garg
1610711
MBA 1st sem.
 Definition of Risk
 Types or Factors of Risk
 Interest Rate Risk
 Market Risk
 Inflation Risk
 Business Risk
 Financial Risk
 Liquidity Risk
Risk concerns the expected value of one or more results
of one or more future events. Technically, the value of
those results may be positive or negative.

OR
Risk can be defined as the chance that the actual outcome
from an investment will be differ from the expected
outcome.
 Variability in the security’s return resulting from the
changes in the level of interest rates.

 Security prices move inversely to interest rates.

 This risk effects bondholders more directly than equity

investors.
 This refers to the variability of returns due to
fluctuations in the securities market.

 Equity shares get most effected.

 Includes factors like wars, politics etc.

 Reduction in the purchasing power.

 Also called purchasing power risk.

 Affects all securities.

 Directly related to the interest rate risk.

 This refers to the risk of doing business in a particular
industry or environment.
 It gets transferred to the investors.

Liquidity Risk
This risk associated with the secondary market.

Securities like treasury bills have least liquidity risk.