Series 79: Currency Risk

Taken from our Series 79 Top-off Online Guide

Currency Risk

Currency risk, also known as exchange rate risk, is the risk that changes in the rate of exchange between currencies will reduce an investor’s profit (or increase an investor’s loss) in a cross-border transaction. The risk is most direct for investors who trade directly in foreign currencies, but it exists in all cross-border transactions where different currencies are involved. Consider the example of an investor in the Unit

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