Meaning of specific risk | Babel Free

Definitions

A risk inherent in a small group of assets that can be mitigated by diversifying, investing in a broad portfolio of assets.

countable, uncountable

Examples

“Therefore, the value is actually exposed to changes in two different risk factors, i.e., systemic risk and specific risk.”

“The fourth type of risk is called specific risk. As the name implies, specific risk is associated with the risk of a specific investment or a specific investment manager. Specific risk is one of the most dangerous types of risk, but fortunately it's also one of the easiest to eliminate.”

“By investing in individual companies, you're exposing yourself to specific risk, or unique business challenges faced by companies. Specific risk is very different than systematic risk, or risk faced by all stocks.”

CEFR level