The risk of a loss due to closing out a transaction is referred to as ____ risk.
A)credit
B)settlement
C)interest rate
D)exchange rate
E)None of these are correct.

Question

Quizplus · Accepted Answer

Settlement risk refers to the risk of a loss occurring when one party fails to deliver on the terms of a transaction on the settlement date, which can happen in various types of financial transactions, including but not limited to trading of securities, foreign exchange, and derivatives.

The Risk of a Loss Due to Closing Out a Transaction