Crypto Trading 101: Financial Risks 加密货币交易101：财务风险
When you invest, you’re exposed to different types of risk. 投资时，您会面临不同类型的风险。
In the context of financial markets, traders define risk as the amount of money that could be eventually lost during trading or investing. Many financial services or transactions contain an inherent risk of loss, and this is financial risk. Financial risk may be applied to a range of activities such as financial markets, business administration, and governing bodies.
The process of assessing and dealing with financial risks is often referred to as risk management.
There are multiple ways of classifying and defining financial risks. Notable examples include investment risk, operational risk and compliance risk.
Types of financial risk
Investment risk
Investment risk relates to investing and trading activities with most of them related to the fluctuating market prices. Market, liquidity, and credit risks are considered part of the investment risk group.
Market risk
Market risk is the risk associated with the fluctuating price of an asset. A trader who bought an asset in the open market will be subject to market risk because volatility may cause the price to drop.
Market risk management requires consideration of how much a trader might lose if the price of the asset moves against the trader’s positions. Thereafter, it is important to strategize on how the trader should act in response to the market fluctuation.
Traders face both direct and indirect market risks. Direct market risk relates to the loss a trader might experience from an adverse change the price of an asset.
Indirect market risk occurs when an asset has a secondary risk. For example, in stock markets, interest rate risk often affect the price of stocks indirectly, which makes it an indirect risk.
Interest rates impact financial markets both directly or indirectly. While the rates affect stocks indirectly, they cause a direct impact on bonds and other fixed-income securities. Depending on the asset category, interest rate risk may be considered a direct or indirect risk.
Liquidity risk
The risk of investors and traders not able to quickly buy or sell a certain asset within a short period of time is called Liquidity risk.
In a high-volume, liquid market, traders can quickly sell their assets because there are enough buyers willing to pay the agreed price for each unit. However, iif the market is illiquid, there would be only a few buyers willing to pay for each unit. In an illiquid market, traders would probably have to sell their assets for a much lower price.
Operational Risk
Operational risk is the risk of financial losses caused by errors in internal processes, systems, or procedures. These failures are often caused by human errors or by criminal fraudulent activities.
To mitigate operational risks, company should perform periodic security audits, along with the adoption of robust procedures and effective internal management.
Poorly managed employees who managed to perform unauthorized trades with their company’s funds are often referred to as rogue trading, and it caused huge financial losses worldwide — especially within the banking industry.
Operational failures may also be caused by external events that indirectly affects the operations of a company, such as natural disasters and geopolitical issues.
Compliance Risk
Compliance risk relates to losses that may arise when a company or institution fails to follow the laws and regulations of their respective jurisdictions. To avoid such risks, companies will adopt specific procedures, such as Anti-money laundering (AML) and Know Your Customer (KYC).
If a service provider or company fails to be compliant, they may be shut down or face serious penalties. Many financial institutions faced lawsuits and sanctions due to compliance failures. Insider trading and corruption are also common examples of compliance risks.
Closing thoughts
Risk is uncertain so it is virtually impossible to avoid risks completely in the financial market. Statistical models such as the standard deviation and regression method can be used to measure exposure to various risk factors.
The best thing a trader or investor can do is to mitigate or control these risks somehow. By understanding some of the main types of financial risk, it is a good first step towards the creation of an effective risk management strategy.
***Disclaimer: This content is not financial advice and should not form the basis of any financial investment decisions nor be seen as a recommendation to buy or sell any good or product. Trading cryptocurrency is complex and comes with a high risk of losing money. You should carefully consider whether trading cryptocurrencies is right for you and take the time to learn how trading works and decide how much money you are prepared to risk.
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Quick guide:
在金融市场中，交易者将风险定义为在交易或投资过程中最终可能损失的金额。许多金融服务或交易包含固有的损失风险，这就是金融风险。金融风险可能会应用于一系列活动，例如金融市场，企业管理和理事机构。
评估和处理财务风险的过程通常称为风险管理。
有多种方法来分类和定义财务风险。著名的例子包括投资风险，运营风险和合规风险。
金融风险类型
投资风险
投资风险与投资和交易活动有关，其中大多数与市场价格波动有关。市场，流动性和信贷风险被视为投资风险类别的一部分。
市场风险
市场风险是与资产价格波动相关的风险。在公开市场上购买资产的交易者将承受市场风险，因为波动可能导致价格下跌。
市场风险管理需要考虑如果资产价格与交易者的头寸相反而产生的损失，那么该交易者可能会损失多少。此后，重要的是制定战略，以制定交易者应如何应对市场波动。
交易者面临直接和间接的市场风险。直接市场风险与交易者因资产价格的不利变化而可能遭受的损失有关。
当资产具有次要风险时，就会发生间接市场风险。例如，在股票市场中，利率风险通常会间接影响股票价格，这使其成为间接风险。
利率直接或间接影响金融市场。尽管利率间接影响股票，但它们直接影响债券和其他固定收益证券。根据资产类别的不同，利率风险可能被视为直接风险或间接风险。
流动风险
无法在短时间内快速购买或出售某种资产的投资者和交易者的风险称为流动性风险。
在大量流动的市场中，交易者可以迅速出售其资产，因为有足够的购买者愿意为每个单位支付约定的价格。但是，如果市场流动性不足，那么只有少数买家愿意为每个单位付款。在缺乏流动性的市场中，交易者可能不得不以低得多的价格出售资产。
运作风险
操作风险是由于内部流程，系统或程序中的错误导致的财务损失风险。这些故障通常是由人为错误或犯罪欺诈活动引起的。
为了降低运营风险，公司应进行定期的安全审核，并采用可靠的程序和有效的内部管理。
管理不善的员工设法利用公司的资金进行未经授权的交易，通常被称为流氓交易，这在全球范围内造成了巨大的财务损失，尤其是在银行业内部。
运营故障也可能是由间接影响公司运营的外部事件引起的，例如自然灾害和地缘政治问题。
合规风险
合规风险与公司或机构不遵守各自管辖区的法律和法规可能引起的损失有关。为避免此类风险，公司将采用特定程序，例如反洗钱（AML）和了解您的客户（KYC）。
如果服务提供商或公司不符合规定，则它们可能会被关闭或受到严厉处罚。由于合规性失败，许多金融机构面临诉讼和制裁。内幕交易和腐败也是合规风险的常见例子。
总结论
风险是不确定的，因此在金融市场上完全避免风险几乎是不可能的。诸如标准偏差和回归方法之类的统计模型可用于衡量各种风险因素的暴露程度。
交易者或投资者可以做的最好的事情就是以某种方式减轻或控制这些风险。通过了解一些主要的金融风险类型，这是朝着制定有效的风险管理策略迈出的良好的第一步。
***此内容不是财务建议，不应作为任何财务投资决策的基础，也不应被视为购买或出售任何商品或产品的建议。交易加密货币很复杂，并且有很高的赔钱风险。您应该仔细考虑交易加密货币是否适合您，并花点时间学习交易的工作方式并确定您准备冒多少风险。
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