Market risk can be defined as:

Market risk refers to the potential for financial losses due to fluctuations in the market value of securities or financial instruments caused by various market conditions. This can include changes in investor sentiment, economic indicators, political events, and other factors that influence overall market movements. Choices that focus on specific risks, such as fraud, interest rate changes, or operational errors, address narrower aspects of risk management but do not encompass the broader concept of market risk, which is inherently tied to the volatility and unpredictable nature of the financial markets. Hence, the correct answer emphasizes the general fluctuations in value, capturing the essence of market risk.