Reinvestment risk is the risk that the return on a future investment will not be the same as the return earned by the original investment.

Question

Quizplus · Accepted Answer

Reinvestment risk refers to the risk of not being able to reinvest cash flows from an investment at the same rate of return as the original investment. This can occur due to changes in market conditions or interest rates. As a result, the return on the future investment may be lower than the return earned on the original investment, leading to reinvestment risk.

Reinvestment Risk Is the Risk That the Return on a Future