Match each investor situation on the left with its corresponding primary systematic risk factor on the right.
- A fixed-income portfolio containing long-duration corporate bonds experiences a significant decline in market value immediately following a central bank benchmark rate hike.Interest Rate Risk
- A retired investor relying on fixed monthly bond coupon payments finds that the real goods and services their income can purchase steadily diminishes during an inflationary environment.Purchasing Power (Inflation) Risk
- An investor holding a broad S&P 500 index ETF suffers portfolio losses during an overall macroeconomic recession that cannot be mitigated by further equity diversification.Market Risk
- A domestic retail investor holding American Depositary Receipts (ADRs) of a European manufacturer sees total investment returns decline when the foreign currency depreciates relative to the U.S. dollar.Currency (Exchange Rate) Risk
Cevap
The scenarios correctly match as follows: bond price drops from rate increases match Interest Rate Risk; eroding fixed payout buying capacity matches Purchasing Power (Inflation) Risk; broad equity market declines unaffected by diversification match Market Risk; and foreign exchange translation losses on ADRs match Currency (Exchange Rate) Risk.
Each scenario accurately illustrates a specific systematic risk subtype: rising interest rates causing existing bond prices to drop represents Interest Rate Risk; inflation eroding fixed coupon buying power represents Purchasing Power Risk; broad macroeconomic declines lowering equity index values represents Market Risk; and foreign currency depreciation lowering converted returns on foreign holdings represents Currency Risk.
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Anahtar Kavram
Systematic risk represents macro-level risks that affect the broader financial system or market as a whole and cannot be eliminated through portfolio diversification.