What are some examples of market risks?
Market risks refer to the potential losses due to changes in market conditions. Examples include interest rate risk, currency risk, and equity risk.
Can you explain interest rate risk?
Interest rate risk is the potential for investment losses due to fluctuations in interest rates, affecting bond prices and borrowing costs.
What about currency risk?
Currency risk arises from changes in exchange rates, impacting international investments and profits when converting currencies.
How can businesses mitigate these risks?
Businesses can use hedging strategies, diversify their investments, and conduct regular market analysis to mitigate these risks.
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