Risk Assessment

Types of financial risk for most of us risk means the probability that, playing in our daily "games", we get the outcome that we are not quite satisfied. In finance, risk is understood in a different and somewhat broader. C viewpoint of the financier risk assessment means the evaluation of the probability that the return on your investment will not be as expected. Thus, the risk assessment includes not only negative (income below expected), but also favorable (earnings higher than expected) outcomes. In practice, the first type of risk can be called "risk reduction (downside risk), and the second type – "the risk of blood (upside risk), and the measurement of risk, we will consider both of these species. Risk assessment and in particular the financial risk assessment, is one of the biggest challenges for the supervisor in managing the company. Measurement and evaluation of financial risk and expected return is difficult to assess because it content varies depending on the chosen point of view. For example, in the analysis and risk assessment company, we can measure it in terms of management of the company.

On the other hand, we can state that the equity firms belongs to the shareholders, and their perspective on risk is also taken into account. The company's shareholders, many of which hold its shares in their portfolios of securities of other companies are likely to perceive the risk business structure quite different than the managers of the company who have invested significant capital into it, both financial and human resources. Identification and assessment of financial risk investors buying assets during his tenure they expect to get some feedback. Actual revenues received during a given period of time, may differ from those expected, and that's the difference between expected and actual income is source of risk, which should be evaluated. The spread of actual earnings as measured by the expected variance (or standard deviation) distribution.

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