Delivery Risk

You bought a bevy of bobbleheads on eBay. But...will you actually get them? Receive them properly and unbroken? Get them delivered?

Yeah, delivery risk is a Thing. Especially when coming from an international seller. PayPal mitigates some of the financial risk, in that there is a relatively straightforward financial tracer. There also exist risks via handling damage from FedEx, getting the wrong item, or even worse—getting nothing at all. Think: Christmas 2018, when you were...naughty.

In the financial world, delivery risk is also sometimes related to counterparty risk. Essentially, it refers to the risk of the other side of a transaction defaulting on either cash for whatever you've sold...or delivery of whatever you've bought.

This can refer to anything from securities trading (where collateral in the form of cash or other securities may need to be verified as collateral) to cargo shipments (where sellers may have to issue a performance bond in the form of a Standby Letter of Credit) to whether or not Domino’s will deliver your pizza after your credit card has already been charged (if they don’t arrive, you’re out of luck unless there’s a Papa John’s or Little Caesar’s in the vicinity.)