Price risk is related to changes in which of the following?

Price risk refers to the uncertainty and potential financial loss associated with fluctuations in the market value of financial instruments or assets. This risk is primarily influenced by changes in supply and demand dynamics, macroeconomic factors, and investor sentiment, which can cause the prices of financial securities, such as stocks and bonds, to rise or fall.

When it comes to portfolios of financial instruments, price risk is particularly relevant because these portfolios can include a diverse range of assets whose market values may be subject to volatility. Changes in market conditions can lead to significant alterations in the values of these assets, affecting the overall worth of the portfolio. For example, in a stock portfolio, if the market experiences downturns due to economic indicators, the value of the equities within that portfolio can decrease, leading to financial loss for the investors.

In contrast, interest rate risk pertains to the potential changes in the value of securities as a result of shifts in interest rates, while credit risk relates to the likelihood of default by borrowers. The value of stock options can also fluctuate due to various factors, but it is not directly classified under price risk in the same way that financial instruments in a portfolio are, as it is more influenced by volatility and market parameters specific to options trading. Hence, the correct association