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Categories of |
Financial risk |
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Credit risk |
Market risk |
Liquidity risk |
Investment risk |
Business risk |
Profit risk |
Non-financial risk |
Interest rate risk is the risk that arises for bond owners from fluctuating interest rates. How much interest rate risk a bond has depends on how sensitive its price is to interest rate changes in the market. The sensitivity depends on two things, the bond's time to maturity, and the coupon rate of the bond.[1]