Economic risk definition

Economic risk. The Subscriber has such knowledge and experience in financial and business affairs as to be capable of evaluating the merits and risks of the Subscriber’s investment in and to any of the Securities, and the Subscriber is able to bear the economic risk of a total loss of the Subscriber’s investment in and to any of the Securities. The Subscriber understands that an investment in any of the Securities is a speculative investment and that there is no guarantee of success of the Company’s management’s plans. Management’s plans are an effort to apply present knowledge and experience to project a future course of action which is hoped will result in financial success employing the Company’s assets and with the present level of management’s skills and of those whom the Company will need to attract (which cannot be assured). Additionally, all plans are capable of being frustrated by new or unrecognized or unappreciated present or future circumstances which can typically not be accurately, or at all, predicted;
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Economic risk. The development of an economy typically takes place in wave movements, the phases of which can be divided into upswing, peak phase, downturn and low phase. This economic cycle and the interventions often associated with it by governments and central banks can last for several years or decades and have a significant impact on the performance of various asset classes. Economically unfavorable phases can thus affect a capital investment in the long term. Inflation risk: Inflation risk describes the risk of suffering financial loss as a result of devaluation. If inflation, i.e. the increase in the price of goods and services, exceeds the nominal interest rate on an investment, this results in a loss of purchasing power in the amount of the difference. In this case, one speaks of negative real interest rates. Country risk: A foreign state can influence the movement of capital and the transferability of its currency. If, for this reason, a debtor resident in such a state is unable to fulfil an obligation (on time) despite its own solvency, this is referred to as a country or transfer risk. An investor can suffer a financial loss as a result. Price risk: Prices are subject to fluctuations and can fluctuate greatly depending on the conditions on the market. This offers the possibility of profits, but also a very high risk of losses. What was worth a lot today can be worthless tomorrow. Be aware of this when you invest. Currency risk: In the case of investments in a foreign currency, the return generated does not depend solely on the nominal return. It is also influenced by the development of the exchange rate of the foreign currency to the home currency. Financial loss can occur if the foreign currency in which the investment was made depreciates against the home currency. Liquidity risk: Investments that can usually be bought and sold in the short term and whose buying and selling prices are close to each other are called liquid ones. For these investments, there is usually a sufficient number of buyers and sellers to ensure continuous and smooth trading. In the case of illiquid investments or even in market phases in which there is insufficient liquidity, however, there is no guarantee that a sale of an investment is possible in the short term and at low price reductions. This can lead to asset losses if, for example, an investment can only be sold with price losses. Cost risk: Costs are often neglected as a risk factor of investment. However, open and hidden co...
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Economic risk the Subscriber has such knowledge and experience in financial and business affairs as to be capable of evaluating the merits and risks of the Subscriber's investment in and to any of the Shares, and the Subscriber is able to bear the economic risk of a total loss of the Subscriber's investment in and to any of the Shares;
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Examples of Economic risk in a sentence

  • Economic risk Changes in both Australia and world economic conditions may adversely affect the financial performance of the Company.

  • Economic risk The level of business activity of our clients, which is affected by economic conditions, has a bearing upon the results of our operations.

  • Economic risk The value of investments held by a Sub-Fund may decline in value due to factors affecting financial markets generally, such as real or perceived adverse economic conditions, changes in the general outlook for revenues or corporate earnings, changes in interest or currency rates, or adverse investor sentiment generally.

  • Economic risk Investment returns are influenced by numerous economic factors.

  • Economic risk is defined as the extent to which currency fluctuations can alter a company’s future operating cash flows, that is future revenues and costs.

  • Economic risk Changes in both Australian and world economic conditions may adversely affect the financial performance of the Company.

  • Economic risk is managed through portfolio diversification and asset allocation and monitoring of investment portfolio by professional fund manager and the investment committee, with the aim to minimise securities exposure in the event of anticipated market weaknesses.

  • Business risk could arise either due to: • Internal risks – risks arising from events that may happen within the company; or • External risks – risks arising from events that happen out of the company Economic risk is somewhat related to Business risk, as the former is a key External risk that is prone to happen which may impact the running of the company.

  • Economic risk describes the vulnerability of a debt security to downturns in the economy.

  • Economic risk and transfer risk are taken into account for the calculation.

Related to Economic risk

  • Economic Risk of Loss has the meaning set forth in Treasury Regulation Section 1.752-2(a).

  • Economic loss means any economic detriment suffered by a victim as a direct and proximate result of the commission of an offense and includes any loss of income due to lost time at work because of any injury caused to the victim, and any property loss, medical cost, or funeral expense incurred as a result of the commission of the offense. "Economic loss" does not include

  • systemic risk means a risk of disruption in the financial system with the potential to have serious negative consequences for the financial system and the real economy;

  • high risk breach means that the threshold for notifying the individual is higher than that for notifying the relevant supervisory authority.

  • Minimal risk means that the probability and magnitude of harm or discomfort anticipated in the research are not greater in and of themselves than those ordinarily encountered in daily life or during the performance of routine physical or psychological examinations or tests.

  • economic resources means assets of every kind, whether tangible or intangible, movable or immovable, which are not funds, but may be used to obtain funds, goods or services;

  • economic operator means any natural or legal person or public entity or group of such persons and/or entities, including any temporary association of undertakings, which offers the execution of works and/or a work, the supply of products or the provision of services on the market;

  • Risk means the combination of the probability of occurrence of harm and the severity of that harm;

  • At risk means a student who has the potential for academic failure, including, but not

  • Loss or “Losses” means any and all losses, costs (including court costs), claims, damages (including fines, penalties, and criminal or civil judgments and settlements), injuries, liabilities and expenses (including attorneys’ fees).