- Factors Influencing Company-Specific Risk Premium
Size and Market Position
The size and marketposition of a company can greatly influence its CSRP. Larger, more established companies tend to have lower CSR… See moreFinance Strategists
- Company-specific risk, also known as unsystematic risk, is associated with a particular investment1. It can be mitigated through diversification1. Two factors cause company-specific risks:
- Business Risk: Internal or external issues affecting operational efficiency.
- Financial Risk: Related to the capital structure of a company2.
Learn more:✕This summary was generated using AI based on multiple online sources. To view the original source information, use the "Learn more" links.Key Takeaways
- Unsystematic risk, or company-specific risk, is a risk associated with a particular investment.
- Unsystematic risk can be mitigated through diversification, and so is also known as diversifiable risk.
www.investopedia.com/terms/u/unsystematicrisk.aspTwo factors cause company-specific risks:
- Business Risk: Internal or external issues may cause business risk. Internal risk relates to the operational efficiency of the business. ...
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