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Library | Item Barcode | Call Number | Material Type | Item Category 1 | Status |
|---|---|---|---|---|---|
Searching... | 30000010046549 | HG4529 C47 2004 | Open Access Book | Book | Searching... |
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Summary
Summary
Risk has two sides: underestimating it harms the investor, while overestimating it prevents the implementation of bold business projects. This book explains, from the point of view of the practitioner, the analysis of investment risk - a proper account of adequate risk management strategies - and offers an objective and readable account of the most common investment risk management procedures. It will not be highly mathematical, although mathematical formulae and technical graphs will be used where necessary, and will not rely on excessive technical jargon.
The author also covers guidelines of regulatory institutions that protect the market and the investor: Bank of International Settlements, US SEC and UK FSA.
Author Notes
YEN YEE CHONG specialises in operational risk management and the design of banking systems. He has been working for DSL Consultants Ltd. in implementing dealing systems around the world. He has been designing financial environments in UK, USA, Sweden, Greece, Estonia and Russia. This also included working for the George Soros-backed Civic Education Project based in the Central European University. Partly as a result of this work, he speaks six languages. At the moment, he is working on a contract focused on credit and operational risk management for the German state development bank (KfW) in Latin America. His first degree was in Economics, whilst his Masters was in Artificial Intelligence and business Expert Systems. This is his fourth book on risk management, previous books covering Emerging Markets risk (ex-USSR), project risk and e-Business risk for the Financial Times group.
Table of Contents
| 1 Introduction to Investment Risk |
| Dream versus rude awakening |
| Book structure |
| 2 The Beginning of Risk |
| Risk and business |
| Case study: The shark and its risk |
| Case study: The ruin of Crédit Lyonnais (CL) |
| Case study: ABB engineering.Investment scams |
| Banking risk and sharks |
| Risk management as a discipline |
| Humans and risk |
| Case study: High-street retail store losses |
| Case study: Allied Irish Bank (AIB) |
| The state of the investment game |
| Risk types |
| Reputation risk |
| Case study: Equitable Life |
| Credit risk |
| Market risk |
| Operational risk |
| Risk and damage |
| Viable alternatives |
| 3 Investing under Risk |
| Human behaviour and investment choice |
| Portfolio management |
| Value-at-Risk (VaR) |
| Monte Carlo simulation |
| Collective use of mathematical tools |
| Position keeping |
| Investment managerial control |
| The treasurer's role |
| Trading and risk management |
| Investment risk experts |
| Case study: A large UK PLC defined benefits pension fund |
| Who controls whom |
| 4 Investing under Attack |
| Investor disenchantment |
| Risk-bearers and risk-takers |
| Professional investor/shareholder |
| Investment companies/fund managers |
| Investment banks |
| Auditors |
| A look in the risk mirror |
| Risk-averse |
| Risk-neutral |
| Risk-takers |
| Investor analysis |
| Types of CEO - birds of a feather |
| The CEO eagle - The M&A addict |
| The CEO dodo - Risk-phobic |
| The CEO ostrich - Risk-ignorant |
| The CEO owl - Risk-acceptable |
| The CEO magpie - Risk-seeking |
| Company structure and risks |
| Case study: The executive background check |
| Risk vanities |
| Pensions mis-selling |
| Case study: Boo.com.Corporate misgovernance |
| Accuracy of corporate losses |
| Classes of instruments and their risk components |
| Derivatives |
| Bonds |
| Equities |
| Investment as a project |
| 5 Investing under Investigation |
| Instinct versus ability |
| Checking corporate fundamentals |
| Formulate a business plan |
| Due diligence |
| Risk support and methodology |
| Investor cynicism |
| Case study: LTCM |
| 6 Risk Warning Signs |
| Prevailing risk attitudes |
| Reputational risk |
| Case study: Enron |
| Airborne early warning (AEW) |
| International accounting standards (IAS) |
| Credit ratings |
| The ratings procedure |
| Business lines |
| Law and risk management |
| Case study: the UK Football League |
| What the law covers |
| Completeness of contract |
| Case study: Merrill Lynch versus Unilever pension fund |
| Sarbanes-Oxley Act for audit control |
| Insurance |
| Risk retention: self-insurance |
| Case study: Insuring big oil projects |
| Case study: the Names and Lloyds, London |
| Sharing, transferring or mitigating risk |
| Search for risk management |
| Alternative theories |
| Causality and managing investment risk |
| Value-added chain |
| Risk management to pick up the pieces |
| Scenario analysis |
| Case study: Business Continuity, lessons from September 11 th |
| Case study: Guaranteed annuity payments |
| Stress testing |
| Bayesian probability |
| Artificial intelligence (AI) and expert systems |
| Case study: Anti-money laundering |
| Risk maps |
| 7 The Promise of Risk Management Systems |
| Current state of systems |
| Risk management methodology - RAMP |
| Activity A Analysis and project launch |
| Activity B Risk review |
| Activity C Risk management |
| Activity D Project close down |
| Financial IT system support |
| The Basel II Loss Database project Case study: Algorithmics systems in a bank |
| Integration and straight-through processing (STP) |
| IT systems project failure |
| Case study: IT overload |
| Tying financial system functionality to promise |
| Risk Prio |
