How does interest rate risk differ from market risk

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1. How does interest rate risk differ from market risk?

2. You are the risk manager for a $2 billion portfolio of auto loans. The economy over the past five years has been strong and losses on your portfolio have been low. But conditions are changing and you believe that over the next three years, losses could increase substantially to the point of nearly wiping out all the profit made in the past five years. Provide some discussion of how you might mitigate this risk.

Reference no: EM13936506

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