Micro Risk

AAA

DEFINITION of 'Micro Risk'

A type of political risk that refers to political actions in a host country that can adversely affect selected foreign operations. Micro risk can come about from events that may or may not be in the reigning government's control.


INVESTOPEDIA EXPLAINS 'Micro Risk'

For example, diplomatic tension with Country A has caused the citizens of Country B to vandalize all Country A based companies situated in Country B. In this example, only operations from Country A were faced with adverse situations. Operations from other countries were not affected.

RELATED TERMS
  1. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. ...
  2. Systematic Risk

    The risk inherent to the entire market or entire market segment. ...
  3. Country Risk

    A collection of risks associated with investing in a foreign ...
  4. Political Risk

    The risk that an investment's returns could suffer as a result ...
  5. Risk

    The chance that an investment's actual return will be different ...
  6. Macro Risk

    A type of political risk in which political actions in a host ...
Related Articles
  1. Broadening Your Portfolio's Borders
    Investing Basics

    Broadening Your Portfolio's Borders

  2. What Is An Emerging Market Economy?
    Economics

    What Is An Emerging Market Economy?

  3. What is political risk and what can ...
    Investing

    What is political risk and what can ...

  4. Can Investors Trust Official Statistics?
    Economics

    Can Investors Trust Official Statistics?

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center