SIE Risk Types Chart – Free PDF
- April 1, 2025
- Posted by: 'FINRA Exam Mastery'
- Category: Finance
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Certainly! Here’s an overview of the key investment risk types that are important for the Securities Industry Essentials (SIE) Exam:
📊 Investment Risk Types
- Capital Risk
- Risk of losing the original investment.
- Credit Risk
- Risk that a bond issuer will default on payments.
- Currency Risk
- Risk of losses due to fluctuations in foreign exchange rates.
- Inflation (Purchasing Power) Risk
- Risk that inflation will erode the value of returns.
- Interest Rate (Reinvestment) Risk
- Risk that rising interest rates will lead to falling bond prices.
- Liquidity Risk
- Risk of being unable to sell an investment quickly at a fair price.
- Market (Systematic) Risk
- Risk of losses due to overall market declines.
- Non-Systematic Risk
- Risk specific to a company or industry.
- Political Risk
- Risk of losses due to political events or instability.
- Prepayment Risk
- Risk that a borrower will repay a loan earlier than expected, affecting returns.
These risk types are essential for understanding the dynamics of the market and will help you during the SIE exam. Ensure you are comfortable with each of these concepts and how they apply to different investment products.