Non-Profits: Program Evaluation and Monitoring
The need for program evaluation and monitoring Though the non-profits sector is not a sector where each pie of money spent needs to be accounted for under the law, nonetheless, since donor funds are involved, there is a need to evaluate the programs and monitor them for leakages and fraud or even for the simple […]
What is Workplace Violence and How to Deal with it
Workplace violence is easily the most misunderstood concept in the contemporary organizational context. This is because the term is misleading and whenever one mentions workplace violence, we conjure images of rioting and destruction as happened recently in the Maruti plant in Manesar, India or the Foxconn facilities in China. However, without discounting these incidents as […]
Determining Forces of Organizational Change
Organization as a system, depend on many interdependent factors which influence it’s day to day functioning, strategic decisions and future action plans for facing the competitive challenges successfully. These factors can be both internal and external in nature and determine an organization’s readiness for change as well as it’s preparedness. External Forces of Organizational Change […]
Introduction to Value At Risk (VaR)
The concept of value at risk (VaR) is closely connected with the concept of market risk mitigation. This is why the discussion about one invariably turns to a discussion about the other. The concept of value at risk (VaR) was developed by many financial institutions as they wanted to know how volatile their portfolio was. […]
Interview Etiquette – Codes of Conduct for Interviews
Etiquette refers to good manners which help transform a man into a gentleman. An individual must behave well in public to gain respect and appreciation from others. It is essential to behave in a socially acceptable way. Interview is nothing but an interaction between the employer and potential employee where the employer tries to judge […]
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.
Your email address will not be published. Required fields are marked *
