Causes of risks, Financial Management

Assignment Help:

Q. Causes of Risks

1) Wrong decision of what to invest in.

2) Wrong timing of investments.

3) Nature of instruments invested such as shares or bonds, chit funds, benefit funds are highly risky than bank deposits or P.O. Certificates etc. .

4) Creditworthiness of Issuer: Securities of government and semi government bodies are more Creditworthy than those issued by the corporate sector.

5) Maturity Period or Length of Investment: Longer the period, the more risky is the investment Normally.

6) Amount of Vestment: Higher the amount invested in any security the larger is the risk.

7) Method of investment, namely, secured by collateral or not.

8) Terms of lending such as periodicity of servicing, redemption periods etc.

9) Nature of industry or business in which the company is operating.

10) National and international factors, acts of god, etc.


Related Discussions:- Causes of risks

Why does money have time value, Why does money have time value? Positiv...

Why does money have time value? Positive interest rates point toward that money has time value.  When one person lets one more borrow money, the first person needs compensation

Arrow as an fsa’s risk based approach to regulation, ARROW as an FSA's risk...

ARROW as an FSA's risk based approach to regulation ARROW stands for Advanced, Risk-Responsive Operating Framework. In January 2000, FSA set out a proposed approach to regulati

Show external business risk, Q. Show External business risk? External r...

Q. Show External business risk? External risk is the result of operating conditions imposed on the firm by circumstances beyond its control. The external environments in which

Two-for-one stock split, The equity accounts for Hexagon International are ...

The equity accounts for Hexagon International are as follows: a.    If Hexagon stock currently sells for $50 per share and a 20% stock dividend is declared, how many new s

Determine the objectives of profit maximisation, Determine the objectives o...

Determine the objectives of Profit maximisation Profit maximisation remains one of the key objectives for the managers of the companysince many managers' compensations are lin

Describes the concept of time value of money, Q. Describes the Concept of T...

Q. Describes the Concept of Time value of Money? 'Time value of money' signifies that the value of a unit of money is different in different time periods. The worth of a sum of

Find out the value of firm according to the mm approach, Example: - Two fir...

Example: - Two firm U as well as L is identical in every respect except that U is unlevered and L is levered. L has Rs. 20Lakh of 8% debt outstanding. The net operating income of b

What is trustworthy collateral from the lenders'' perspective, What is trus...

What is trustworthy collateral from the lenders' perspective?Explain whether accounts receivable and inventory are trustworthy collateral. Assets that are readily marketable of

Operating cycle, discuss the applicability operating cycle considering broi...

discuss the applicability operating cycle considering broilers in uganda?

Cash books, Cash Books (Cash Payments and Receipts Journals) Cash books...

Cash Books (Cash Payments and Receipts Journals) Cash books are the names given to the Cash Receipts Journal and the Cash Payments Journal. They are used to record the flow of

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd