Definition of Financial risk:
The probability of loss inherent in financing methods which may impair the ability to provide adequate return.
Financial risk is a type of danger that can result in the loss of capital to interested parties. For governments, this can mean they are unable to control monetary policy and default on bonds or other debt issues. Corporations also face the possibility of default on debt they undertake but may also experience failure in an undertaking the causes a financial burden on the business.
Financial risk is the possibility of losing money on an investment or business venture. Some more common and distinct financial risks include credit risk, liquidity risk, and operational risk.
How to use Financial risk in a sentence?
- I didnt want to purchase the item because I knew it would be too big of a financial risk and could hurt us.
- Investors can use a number of financial risk ratios to assess a company's prospects.
- Financial risk generally relates to the odds of losing money.
- Mark Zuckerberg dropped out of college, and spent a great deal of time and money founding one of the most successful social media platforms ever; all at great financial risk .
- Credit risk, liquidity risk, asset-backed risk, foreign investment risk, equity risk, and currency risk are all common forms of financial risk.
- The financial risk most commonly referred to is the possibility that a company's cash flow will prove inadequate to meet its obligations.
- Financial risk can also apply to a government that defaults on its bonds.
- You should always try to accurately assess the financial risk of any new venture to see if it is worth it.
Meaning of Financial risk & Financial risk Definition