What does the term 'fundamental risk' refer to?

The term 'fundamental risk' refers to a risk that has broad, systemic implications rather than being confined to personal or localized effects. This means it affects entire populations or large groups, rather than individuals. The characteristics of fundamental risk include its nature of not allowing for the possibility of profit; outcomes are typically limited to break-even or loss. This reflects the inherent unpredictability and severity of such risks, which can be tied to external economic factors, natural disasters, or societal changes.

In contrast, personal or local risks cater to individual circumstances and do not fit the broader characteristics of fundamental risk. Thus, options discussing localized impacts or personal experiences do not align with the definition. Similarly, a gamble or risk with the potential for profit or only minor impacts deviates from the core essence of fundamental risk, which is defined by its more serious and widespread consequences.