Market risk
Market risk is the possibility of losses caused by changes in market prices or rates, including currencies, equities, commodities, and interest rates. It affects open positions even when orders execute normally and counterparties meet their obligations.
In a hypothetical example, a trader holds a long currency position when an unexpected policy announcement causes the currency to fall, reducing the position’s value.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Glossary definitions are general education only and are not investment advice. Risk disclosure