Risk management: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson m (Added risk averse to see also to link with new page) |
imported>Doug Williamson (Link with qualifications page) |
||
| Line 31: | Line 31: | ||
* [[Asset-liability management]] | * [[Asset-liability management]] | ||
* [[Black swan]] | * [[Black swan]] | ||
* [[CertICM]] | |||
* [[CertRM]] | * [[CertRM]] | ||
* [[Corporate treasury]] | * [[Corporate treasury]] | ||
Revision as of 11:07, 29 November 2014
Risk management is about understanding what business and financial risks the company is exposed to and considering whether the returns generated are sufficient to justify taking those risks.
The risks need to be evaluated and assessed so that decisions can be made on whether to retain them, to employ techniques to mitigate or transfer risk. The underlying risks can be managed to limit risk. They can be hedged with counterbalancing exposures often created through the financial markets, or insurance taken out to protect the company’s financial health.
Risk management includes the management of:
- Business and operational risk
- Commodity risk
- Credit risk
- Exotic risk
- FX risk
- Interest rate risk
- Managing risk
- Pensions risk
One way of working with risk management is through a framework comprising:
- Identification
- Assessment
- Evaluation
- Response and
- Reporting
