Risk arises from trading of assets because of change in asset prices and exchange rates is classified as

Risk arises from trading of assets because of change in asset prices and exchange rates is classified as market risk. Market risk is the possibility of an investor experiencing losses due to factors that affect the overall performance of the financial markets in which he or she is involved. Market risk, also called "systematic risk," cannot be eliminated through diversification, though it can be hedged against in other ways.