Undiversifiable Risk

Risk which is common to an entire class of assets or liabilities. The value of investments may decline over a given time period simply because of economic changes or other events that impact large portions of the market. Asset allocation and diversification can protect against undiversifiable risk because different portions of the market tend to underperform at different times. also called systematic risk or market risk.

Risk Margin

A value that takes into account the potential movement of a stock in relation to its option position. A more volatile investment would have a higher risk margin, since the potential for large swings in price is greater than that of a more stable investment.Premium margin and risk margin are the two components comprising the margin requirement.

Weak Dollar

Dollar that can be exchanged for only a small or decreasing amount of foreign currency. A weak dollar means that the U.S. dollar cannot buy very much of another currency. The strength of the dollar has an impact on imports and exports because goods and services from a foreign nation are usually purchased in the currency of the producing nation. A weak dollar usually leads to high exports and low imports. opposite of strong dollar.