In the financial world, risk management is the process of identification, analysis and acceptance or mitigation of uncertainty in investment decisions.

Essentially, risk management occurs any time an investor or fund manager analyzes and attempts to quantify the potential for losses in an investment and then takes the appropriate action or inaction given his investment objectives and risk tolerance.

Risk management occurs everywhere in the financial world.

Key Risk Management Principles for Forex Trading

It occurs when an investor buys low-risk government bonds over more risky corporate bondswhen a fund manager hedges his currency exposure with currency derivatives and when a bank performs a credit check on an individual before issuing a personal line of credit. Dictionary Term Of The Day.

A measure of what it costs an investment company to operate a mutual fund.

Risk Management

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