What Are the Key Factors Influencing Counterparty Risk?
Several factors can influence counterparty risk, including:
Financial Health: A counterparty’s balance sheet strength and profitability. Credit History: Past behavior in meeting financial obligations. Economic Conditions: The broader economic environment can affect a counterparty's ability to pay. Market Conditions: Fluctuations in market prices and interest rates. Political Risk: Regulatory changes and geopolitical events.