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Definition

<p style="text-align: justify;">A term to describe that <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">risk</span> which attaches to a specific <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">investment</span> - as opposed to <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">systematic risk</span> which pertains to the <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">market</span> as a whole. In a <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">bear trend</span> almost all <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">shares</span> will fall, irrespective of their individual investment merits - simply because <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">sentiment</span> has turned <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">bearish</span> and people generally are selling shares. The opposite is true during a <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">bull market</span>. That is the systematic risk in the market. Clearly, it is better for the <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">private investor</span> to be completely out of a bear market and fully invested druing a bull market. Unsystematic risk is the risk that the particular share which have chosen will do badly for internal reasons. The way to evaluate unsystematic risk is to study the <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">company</span>'s <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">fundamentals</span> (its <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">balance sheet</span>, <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">income statement</span>, <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">management</span>, and industry) and to look carefully at its <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">chart</span>s for any sign of a <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">downward trend</span> - such as a <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">head-and-shoulders</span> formation or <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">double top</span>. By the start of 2022, world <span class="glossary" style="border-bottom: 1px dotted black; cursor: pointer;">markets</span> were entering the final stages of the great bull market which had been runing since March 2009 so systematic risk was relatively low.</p>