Essay Risk Management

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What is risk? "Simply put, risk is uncertainty. The more risk you take, the more you stand to lose or gain. You cannot expect high returns without taking substantial risks." Tossing a dice, is at basic level a risky endeavor. The outcomes are thrown open to uncertainty. You take risk everytime you act, from crossing the street; to buying a stock. Generally when people talk about risk, they focus on financial risk. In terms of finance, it is the risk that a company or individual could lose some or all of the original investment, possibly resulting in inadequate cash flow to meet financial obligations.…show more content…
The patterns of any particular investment will detail the relative risks and rewards undertaken with each investment. Risk focuses on the future and our ability to forecast that future. In turn, the ability to predict the future is largely dependent on what you’ve learned from the past. The best you can do is to study the record and draw on experience - your own and that of others. There is no easy scientific method that will guarantee all risks will be identified. Examine all sources of risk from the perspectives of all stakeholders. Each source needs to be identified so that your analysis can consider the contribution each makes to the gains and losses of the risk. You can identify risks through: flow charting, system design review, systems analysis history, failure analysis incidents or complaints interviews/focus groups SWOT Analysis survey or questionnaire Some types are of risks are relatively more or relatively less important depending on the situation and application. In some theoretical models of financial processes, some types of risks or

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