Suppose you are a trader specializing in futures on corn, wheat, oats, barley, and other... 1...

Question:

Suppose you are a trader specializing in futures on corn, wheat, oats, barley, and other... 1 answer below Suppose you are a trader specializing in futures on corn, wheat, oats, barley, and other agricultural commodities.

From the following list, which risks do you face (mark each with a yes or no):

credit risk
market risk
liquidity risk
settlement risk
operational risk
legal risk

Risks:

Risks are the probability of unanticipated things happening to result in adverse effects on the earnings of a firm. There are various types of risks that may exist. The types of risk will vary with the type and nature of business.

Answer and Explanation:

The resultant table of on whether the business will be faced by the stated risks is as follows:

credit risk No
market risk Yes
liquidity risk Yes
settlement risk No
operational risk yes
legal risk No

Learn more about this topic:

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Investment Risks: Definition & Types

from Finance 305: Risk Management

Chapter 3 / Lesson 3
4.7K

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