Enterprise Risk Management (ERM) considers both pure risk and speculative risk. Name two speculative financial risks that the Chief Risk Officer (CRO) might want to manage. How important are these risks to the firm?
Two speculativerisk the manager should be managing are-
A. Investment in to other company because the value of investment can either go up or other go down or same so there will be a speculative risk related to investment into other companies.
B. Taking exposure into the option contract is another example of speculative risk because option contract will be also having a large amount of speculation associated with the gain or the loss and they will be offering with the right not the obligation
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