FINANCIAL RISK DEFINITIONS
Financial Risk: The risk of loss from holding positions that are subject to change in value with changing market conditions. This risk includes all changes in market conditions, such as, prices, volatility, liquidity, and credit risk, the ability and willingness of counterparties to honor their contractual oligations.
Lloyd's of London provided re-insurance without protracted and significant losses for 300 years. The equity holders in this enterprise started to think they were purchasing annuities rather than placing their considerable assets at risk. With a history of profits without significant loss that spans ...