(1) Import and export risks of goods and services.

(2) Risk of capital input and output.

(3) The risk of foreign exchange banks holding foreign exchange positions, exchange rate risk is one of them, also known as foreign exchange risk, which refers to the possibility of losses due to exchange rate changes in economic activities in which economic entities hold or use foreign exchange.

2. Exchange rate risk can be divided into transaction risk and translation risk (accounting risk). The bookkeeping base currency refers to various currencies used in circulation in economic entities and commercial activities. The functional currency refers to the reporting currency used in the preparation of consolidated financial statements, when the currency depreciates against the US dollar. If the stock held by investors is denominated in foreign currency.

Translation risk, also known as accounting risk, refers to the possibility of book losses and economic risks (business risks) caused by exchange rate changes when economic entities convert the bookkeeping base currency into bookkeeping base currency in the accounting treatment of balance sheets.

Exchange rate risk In transactions denominated and received in foreign currency, when the exchange rate of this currency is stable or appreciated, investors will get lower returns.

It is usually the domestic currency, and the possibility of economic entities suffering losses due to changes in foreign exchange rates. Trading risks mainly occur in the following situations.