The second kind of risk is systematic risk, or risk that affects the larger system instead of an individual asset. Systematic risk is when every stock rises or falls together because the entire market surges or crashes, as it did in 2008. Systematic risk events often happen because of a big economic disruption like a recession or an election result that people think will impact business. Systematic risks are harder to manage than idiosyncratic risks, and the downsides are potentially more dangerous. If the entire stock market tanks, you risk losing your job and stock portfolio at the same
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