Tips for Conducting Interviews
Whether it is a job interview or a follow-up interview with selected respondents who filled a survey questionnaire, it is essential that right questions are asked. However, asking a right question is just not it… There is more to conducting effective interviews. Read on to know how an interview conversation can be made effective… Avoid […]
Rewards and Recognition System in Virtual Teams
In case of traditional co-located teams, pizza parties, lunch/dinner outings etc. are common approaches to celebrating team success while cash or non-cash awards such as public appreciation, customized merchandise or certificates are used to recognize individual performance. But when the teams are globally distributed, it becomes a challenge to reward and recognize their triumphs in […]
Pros and Cons of Fronting in Reinsurance
In the previous article, we have already learned about how fronting works in reinsurance. We now know how different entities have to collaborate in this complex arrangement called fronting. The concept of fronting is fairly recent and has been growing quite rapidly. However, before deciding whether or not fronting is right for a particular reinsurance […]
Office Politics and Organizational Dynamics
Politics is inevitable wherever there are groups of people and wherever there are blocs of people competing for the same set of scarce resources. In this context, it is indeed the case that organizations have their own share of office politics due to the prevalence of power centres and interest groups each with competing and […]
What is Development Administration ?
The traditional approach towards administration has been limited in its scope and premise, the core of which was strict adherence to laid down rules and hierarchy. In essence it has limited the role administration to that of a fire fighter or overseer of law and order in the comfort of laid down principals. While, nothing […]
In stock market there is strong relationship between risk and return. Greater the risk, greater the return generally! In financial terminology risk management is the process of identifying and assessing the risk and then developing strategies to manage and minimize the same while maximizing the returns.
Every investment demands a certain amount of risk and for an investor to assume this risk he has to be compensated duly. This compensation is in the form of something called as the risk premium or simply the premium. Risk is therefore central to stock markets or investing because without risk there can be no gains. Successful investors use stock market risk management strategies to minimize the risk and maximize the gain.
In financial markets there are generally two types of risk; first the Market Risk and second the Inflation Risk.
The inflation risk is an important consideration in long term investments where as the market risk is more relevant in the short term. It is the market risk that can be managed and controlled to a certain extent, inflation risk cannot be controlled.
There are certain strategies that can be employed to mitigate the risk in a stock market. The strategies are as follows:
Ask Warren Buffet, the greatest investor of all time, what is your advice to investors and he says ‘don’t lose money!’ But stock market connotes risk and fortunately there are enough strategies for a wise investor to safeguard his money and ensure gain. A careful and timely exercise of these options helps you see of the risk involved.
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