investment risk management

investment risk management

While discussing about financial risk management then we should also talk about investment risk management.

investment risk management
alt text

Project Financial Risk

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Proin et felis eget tellus pharetra porttitor. Praesent dui arcu, egestas quis, adipiscing a.

Project Financial Risk
alt text

Capital budgeting how to calculate IRR

Capital budgeting is the process of expenditures planning whose cash flow is expected to reach beyond the year.

Capital budgeting how to calculate IRR
alt text

How FORD motor company is managing their production

On Wednesday A top executive said that Ford Motor Co (FN) is closely watching their inventories and waiting to see if the U.S. government of "money for Clunkers" program was extended,

How FORD motor company is managing their production

Friday, February 15, 2013

Stock Market 101: Risk Management Strategies

Risk management - what is it? What does it imply? Risk is basically the probability that something unpleasant will occur when it comes to investment. It is the consciousness that you may lose your invested cash. It is simple to connect risk with finances, and all sane investors would want to remove losses from the investment equation. Unfortunately, that isn't how the market operates. Losses are a part of the investment game, and all investors can do is try to avoid it as much as possible. If you're new to the finance world, here's what you need to know.

Asset Allocation

Asset allocation and hedging are two prime strategies investors practice to manage risk. Asset allocation comprises shifting a portion of your investment to a more conservative one, such as bonds, and distancing them from riskier options like shares if you feel that the market may be in for a drop in the next few years. Normally, if you feel the market is heading uphill and economic conditions are becoming more favorable, you should shift a more sizable portion of your portfolio into shares and eliminate any kind of hedge you originally had in place.

Purchase Options

Some investors manage their investment risk with purchasing options. Perhaps the simplest means of doing so is by buying "put options" to safeguard the position of some shares in your investment. Put options improve in value when the value of the share drops. They also function very much like insurance policies in that you pay an upfront charge in case a share you own drops in value. For example, you purchased a share at $50 each and it has now increased to $60. You think there will be a slight drop, yet you wish to continue holding that spot in your investment and do not want to sell it. You can then purchase a put option at $55 each for security.

Covered Call

A good risk management alternative is the so-called "covered call" tactic. If you own a share, you'd sell a cover call atop the present value of the share and instantly gather the cash from the option's sale. You get the cash, regardless of what the share does, so it can add a silver lining to a flat or downhill share. In the event that the share's price rise sharply atop the strike price, you'd be forced to sell your shares at a costlier value. Apparently, if your share drops very drastically, the few hundreds of dollars you received for the call would not completely encompass the thousands you may have lost in a substantial stock drop.
Stop loss or trailing strategies are yet another tool to ensure that you do not lose cash in the event that the stock diminishes in value. Furthermore, a universal strategy that everyone from novices to veterans must employ on a daily basis is to always exercise discipline, because it's crucial to time the precise moment he/she should sell or purchase stock.
Jane Gilmore writes about finance, business and economics. Her most recent work is autobiographical, chronicling her journey going to business school online.

Friday, February 1, 2013

Recent News on PPI and Investment Mis-selling

The ppi scandal has another £1bn added to it. Lloyds Banking Group has announced an additional charge of £1bn for the covering of redress costs which raises the company’s total to £5.3bn with more guaranteed.
Customers who had become victims of the mis-selling of payment protection insurance have not only brought a living nightmare on the bailed out Lloyds Banking Group but other high street banks have to incur ppi scandal combined costs over £10bn. The Royal Bank of Scotland has added £400m to its already massive £1.3bn compensation charge.

Friday, May 4, 2012

Serviced Office Interiors can Reduce Your Burden

So you wish to shift your office from the confines of your home to a more professional set up? Well, what better than moving into an established leased property? Shifting an office is a daunting task and you need to have a clear idea about the space and the functionality of the space. It is generally believed that serviced offices are better to use than creating a whole new one. There are quite a few reasons for it. The best part about shifting business into an already established leased property is that you can save a good amount of money. The duration of the agreement for rent in this circumstance is less than renting a traditional office space. The duration is usually between 2 months and 12 months.
 
Copyright (c) 2010 Financial Risk Management www.frmrule.com. | Webmaster: Sumit Dewanjee