Systematic risk and unsystematic risk are two types of risks associated with investing in securities.
1.Systematic Risk: Systematic risk refers to the risk that affects the financial market as a whole. It is inherent in the market and cannot be eliminated through diversification. It is associated with factors such as economic recessions, market crashes, and natural disasters that impact the entire market.
2.Unsystematic Risk: Unsystematic risk, also known as company-specific risk, refers to the risk that is specific to a particular company or industry. It can be reduced through diversification, as it is not related to overall market conditions. Unsystematic risk can be caused by factors such as management changes, product failures, or regulatory changes that affect a specific company or industry.
9/27/2023 01:33pm
