Sovereign Risk
The risk that a foreign central bank will alter its foreign-exchange regulations thereby significantly reducing or completely nulling the value of foreign-exchange contracts. Investopedia Says:
This is one of the many risks that an investor faces when holding forex contracts. Additionally an investor is exposed to interest-rate risk, price risk and liquidity risk amongst others. Related Terms:
Country Risk
Default
Interest-Rate Risk
Liquidity Risk
Political Risk
Price Risk
Systematic Risk
Unsystematic Risk |