In
finance, rate risk is the risk of losses caused by
interest rate
An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, t ...
changes. The prices of most financial instruments, such as
stock
In finance, stock (also capital stock) consists of all the shares by which ownership of a corporation or company is divided.Longman Business English Dictionary: "stock - ''especially AmE'' one of the shares into which ownership of a company ...
s and
bonds move inversely with interest rates, so investors are subject to
capital loss when rates rise.
In the investment world, there are two types of risk rating. One is to manifest company's credit and another to equity securities. The former is represented by the systems of
Fitch Ratings
Fitch Ratings Inc. is an American credit rating agency and is one of the " Big Three credit rating agencies", the other two being Moody's and Standard & Poor's. It is one of the three nationally recognized statistical rating organizations ( NRS ...
,
Moody's
Moody's Investors Service, often referred to as Moody's, is the bond credit rating business of Moody's Corporation, representing the company's traditional line of business and its historical name. Moody's Investors Service provides internation ...
and
Standard & Poor's
S&P Global Ratings (previously Standard & Poor's and informally known as S&P) is an American credit rating agency (CRA) and a division of S&P Global that publishes financial research and analysis on stocks, bonds, and commodities. S&P is co ...
whereas the later by that of
Comisión Clasificadora de Riesgo, although the two types have some similarities to some extent.
Financial economics
Market risk
Interest rates
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ru:Риск процентной ставки