risk exposure

A: Risk exposure refers to the extent to which an entity's wealth is affected by risks, that is, the value of assets and liabilities that financial institutions, enterprises or individuals are easily affected by risk factors in various business activities, or the positions exposed to risks. For example, individuals may face special types of risks because of their occupation, work nature or consumption patterns; Families may face some risks due to illness and unemployment of their members; Enterprises may affect profits because of market prices, raw materials and other reasons; The value of various risky assets held by financial institutions will change with the change of interest rate and exchange rate. The risk of assets or transactions cannot be estimated in isolation or abstractly. In one case, the sale of specific assets may increase the risk exposure; In another case, the same transaction may reduce the risk.