Market risk tends to rise when recent news has been more surprising than before.

Question

BlackTom AI · Accepted Answer

When evaluating how market risk responds to news, the key idea is that surprises increase uncertainty and price correction, which tends to elevate volatility and risk.
Option 1: 'Make sense' — This aligns with core financial intuition that larger or more unexpected news pushes markets away from prior expectations, leading to bigger price moves and higher risk in the near term. In other words, the surprise element adds information asymmetry and traders adjust positions, amplifying volatility.
Option 2: 'Make no sense' — This would be incorrect because if news were less surprising over time, we would typically expect a reduction in incremental risk as expectations align with outcomes, lowering uncertainty and volatility. Claiming that increasing surprise does not affect risk ignores established linkages between information shocks and price dynamics.
In sum, the relation described—risk rising with greater surprise in recent news—is generally consistent with how markets process new information; reducing surprise would, all else equal, tend to dampen risk rather than amplify it.

Market risk tends to rise when recent news has been more surprising than before.单项选择题

类似问题

What is the primary distinction between market risk in the trading book versus the banking book?

An unexpected post on social media caused the prices of 22 different companies’ stocks to immediately increase by 10 to 15 percent. This occurrence is best described as an example of ________ risk.

Which type of risk involves financial loss due to market fluctuations?

Inflation, recession, and high interest rates are economic events that are best characterized as being

In the context of the Capital Asset Pricing Model (CAPM), the relevant risk is

Market risk tends to rise when the market anticipates important but uncertain news events.

Market risk tends to rise when recent news has been more surprising than before.

Market risk tends to rise when the market anticipates important but uncertain news events.

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单