Skillsfirst Level 5 Diploma in Financial Trading (RQF) - Module 1 - Trading Introduction
Skillsfirst Level 5 Diploma in Financial Trading (RQF) - Module 2 - Financial Products
Skillsfirst Level 5 Diploma in Financial Trading (RQF) - Module 3 - Economic Principles
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WHAT ARE THE RISKS ?

RE-INVESTMENT RISK – The possibility that interest rates may have fallen by the time your investment reaches maturity. If this occurs, you may be unable to reinvest your funds at the rate of return you were accustomed to receiving. When interest rates drop, bond prices generally rise because the market is willing to pay more for a higher coupon. When interest rates rise, bond prices generally fall because the market will pay less for a lower coupon.
CREDIT RISK – The risk that the issuer will default on its payments of interest and principal on its debt. You can help manage this risk by choosing only investment-grade bonds (rated BBB or higher) or by diversifying among several issues of high-yield bonds.
MARKET RISK – Yields and market value of bonds will fluctuate so that your investment, if sold prior to maturity, may be worth more or less than its original cost
LIQUIDITY RISK – Possible difficulties to re-sell bond on the secondary market.
INFLATION RISK – The possibility that the value of your investment may not grow enough to keep up with inflation, reducing your purchasing power as a result.
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