RISK MANAGEMENT OF DOMESTIC COMMODITY PRODUCERS USING STOCK MARKET INSTRUMENTS

Introduction. One of the peculiarities of Ukrainian agrarian market functioning is the growth of uncertainties, whose impact has increased significantly as a result of globalization processes. The constant change of external and internal factors causes risks, which become the main problem of management, as they determine the directions and production efficiency and agricultural products sale. Therefore, there is a need to apply progressive risk management methods and tools that are effective and efficient under current conditions. Companies use derivatives (trusted derivatives) to turn their cases around and limit uncertainty about future businesses for revitalization. Therefore, derivatives are actually invested in some economies and make their effectiveness for a higher level of valuable assets in the course of exchange trading. The purpose of the article is to substantiate scientifically theoretical positions and methodological approaches, to develop alternative risk management strategies through stock exchange instruments, namely types of derivatives – options. Results. The importance of theoretical bases formation of the risk essence is substantiated that can be faced by domestic producers. The ways of uncertainties occurrence, stages of their transformation are explained. The theoretical approach to risk management through the use of futures contracts is systematized. The historical stages of using derivatives development have been evaluated. The new approach to risk management is proposed through the use of the optional Collar strategy. Conclusions. Any business activity is unthinkable without risks in developed countries, so any manufacturer seeks to insure its risk, including through a fixed market. The terminal market allows for redistribution of risks among market participants, on which a particular derivative operates. The advantage of derivatives is the leverage that allows participants to operate large amounts of risk management funds, including hedging their own products. Keywords: risk, risk management, risk management, hedges, options, futures, derivatives, derivatives.

Download Full-text

ANALISIS MANAJEMEN RISIKO PEMBIAYAAN MURABAHAH DI PT BPRS ARTHA MADANI KANTOR PUSAT BEKASI

Paradigma ◽

10.33558/paradigma.v17i2.2307 ◽

2020 ◽

Vol 17 (2) ◽

pp. 6-20

Author(s):

Zahrina Wardatul Fawziyah ◽

Isfandayani

Keyword(s):

Risk Management ◽

Management Strategy ◽

Management Strategies ◽

Islamic Banks ◽

Risk Management Strategy ◽

Strategy Analysis ◽

Internal Factors ◽

Legal Risk ◽

Risk Management Strategies ◽

Financing Risk

Risk management is an important effort that must be made by Islamic Banking to minimize risk. This research is a qualitative research and the methods used are interviews, documentation, and observation. The research objective was to determine the types of risks in murabahah financing and the strategy of PT. BPRS Artha Madani in overcoming these risks and to find out the analysis of the implementation of risk management strategies carried out by PT. BPRS Artha Madani Head Office Bekasi.Based on the results of the study it is known that the risk management strategy analysis of PT. BPRS Artha Madani using Bank Indonesia Regulation No. 13/23/PBI/2011 and 5 C principles consist of Character, Capacity, Capital, Collateral and Condition of Economy. However, despite implementing the risk management strategy, banks continue to experience risks, namely in the form of: credit risk (in Islamic banks called as financing risk), operational risk and legal risk due to bank internal factors in analyzing and external factors from customers.PT. BPRS Artha Madani in resolving troubled financing with intensive billing, reprimand to customers if they do not fulfill their obligations, make a restructuring by rescheduling, reconditioning and restructuring if the financing can still be normalized. However, if there is no hope and the Customer is not able to, then the solution is guaranteed that can be auctioned through litigation or non-litigation channels.

Download Full-text

Dynamic Risk Management of Investment Portfolio by Futures Contracts

Regaining Global Stability After the Financial Crisis - Advances in Finance, Accounting, and Economics ◽

10.4018/978-1-5225-4026-7.ch008 ◽

2018 ◽

pp. 147-162

Author(s):

Alexander K. Kerimov ◽

Oleg I. Pavlov

Keyword(s):

Risk Management ◽

Moving Average ◽

Management Strategies ◽

Minimum Variance ◽

Futures Contracts ◽

Investment Portfolio ◽

Expected Return ◽

Dynamic Risk ◽

Dynamic Risk Management ◽

Risk Management Strategies

This chapter is devoted to the dynamic risk management of the investment portfolio using future contracts. The number of futures for each portfolio asset, which is determined by portfolio effectiveness and acceptability of risk at each step, serves as a control parameter. The authors define effective portfolios as the ones of the minimum variance with the expected return greater than or equal to the specified value. Risk is measured by the probability of losing a certain part of the portfolio value. Effective adaptive strategies of portfolio risk management are proposed and their comparative analysis is carried out on a concrete example. In order to determine risk management strategies, the authors implement simple methods of volatility forecasting and correlation of relative changes of price data based on exponential moving average.

Download Full-text

Risk disclosure and firm risk: Evidence from Canadian firms

Risk Governance and Control Financial Markets & Institutions ◽

10.22495/rgcv10i1p4 ◽

2020 ◽

Vol 10 (1) ◽

pp. 52-60

Author(s):

Michel Coulmont ◽

Sylvie Berthelot ◽

Caroline Talbot

Keyword(s):

Risk Management ◽

Stock Exchange ◽

Management Strategies ◽

Composite Index ◽

Systematic Risk ◽

The United States ◽

Annual Reports ◽

Risk Disclosure ◽

Firm Risk ◽

Risk Management Strategies

In recent decades, financial and accounting regulators have turned the spotlight on risk management and disclosure. Like securities regulators in the United States, the United Kingdom and several other countries, Canadian Securities Administrators have set out requirements for the disclosure and discussion of risks in the MD&A section of annual reports. Responding positively to these new guidelines, organisations now report many risks in their MD&A. These disclosure requirements are intended to provide information about a company’s material risks to help stakeholders understand and evaluate interrelated risks, the risks’ impact and the company’s risk management strategies (Khandelwal, Kumar, Verma, & Pratap Singh, 2019). However, since the nature of the risks disclosed derives wholly from organisational decisions, the content of these disclosures can be considered voluntary. For this reason, some critics argue that risk disclosures are by and large boilerplate in nature (Bao & Datta, 2014; Hope, Hu, & Lu, 2016). From this perspective, this study aims to examine whether there is a relationship between the risks firms disclose in their annual reports and their systematic risk. The regression analyses were carried out on the risks disclosed by a sample of 200 Canadian companies included in the 2016 Toronto Stock Exchange S&P/TSX Composite Index. These analyses revealed a positive and significant relationship between the risks disclosed and the firms’ systematic risk. Our results support the regulatory approaches respecting this type of information adopted by a number of countries. Accordingly, disclosing the risks that companies face should help small investors understand and appreciate them.

Download Full-text

Helping supervisees learn ethically based risk management strategies

PsycEXTRA Dataset ◽

10.1037/e500672008-001 ◽

2008 ◽

Author(s):

Samuel Knapp

Keyword(s):

Risk Management ◽

Management Strategies ◽

Risk Management Strategies

Download Full-text

The management of risk in a dryland environment

Proceedings of the New Zealand Grassland Association ◽

10.33584/jnzg.2011.73.2835 ◽

2011 ◽

pp. 13-21

Author(s):

D.I. Gray ◽

J.I. Reid ◽

D.J. Horne

Keyword(s):

Risk Management ◽

Service Providers ◽

Management Strategies ◽

Subterranean Clover ◽

Farming Systems ◽

Market Risk ◽

Farm Size ◽

Forage Crops ◽

Risk Management Strategies ◽

Upside Risk

A group of 24 Hawke's Bay hill country farmers are working with service providers to improve the resilience of their farming systems. An important step in the process was to undertake an inventory of their risk management strategies. Farmers were interviewed about their farming systems and risk management strategies and the data was analysed using descriptive statistics. There was considerable variation in the strategies adopted by the farmers to cope with a dryland environment. Importantly, these strategies had to cope with three types of drought and also upside risk (better than expected conditions), and so flexibility was critical. Infra-structure was important in managing a dryland environment. Farmers chose between increased scale (increasing farm size) and geographic dispersion (owning a second property in another location) through to intensification (investing in subdivision, drainage, capital fertiliser, new pasture species). The study identified that there may be scope for further investment in infra-structural elements such as drainage, deeper rooting alternative pasture species and water harvesting, along with improved management of subterranean clover to improve flexibility. Many of the farmers used forage crops and idling capacity (reduced stocking rate) to improve flexibility; others argued that maintaining pasture quality and managing upside risk was a better strategy in a dryland environment. Supplementary feed was an important strategy for some farmers, but its use was limited by contour and machinery constraints. A surprisingly large proportion of farmers run breeding cows, a policy that is much less flexible than trading stock. However, several farmers had improved their flexibility by running a high proportion of trading cattle and buffer mobs of ewe hoggets and trade lambs. To manage market risk, the majority of farmers are selling a large proportion of their lambs prime. Similarly, cattle are either sold prime or store onto the grass market when prices are at a premium. However, market risk associated with the purchase of supplements and grazing was poorly managed.

Download Full-text

The Effects of Decision Aid Orientation on Risk Factor Identification and Audit Test Planning

Auditing A Journal of Practice & Theory ◽

10.2308/aud.2002.21.2.39 ◽

2002 ◽

Vol 21 (2) ◽

pp. 39-56 ◽

Cited By ~ 29

Author(s):

Jean C. Bedard ◽

Lynford E. Graham

Keyword(s):

Risk Factors ◽

Risk Management ◽

Decision Aid ◽

Decision Aids ◽

Management Strategies ◽

Risk Identification ◽

Matched Pair ◽

Audit Planning ◽

Audit Firms ◽

Risk Management Strategies

In auditing, risk management involves identifying client facts or issues that may affect engagement risk, and planning evidence-gathering strategies accordingly. The purpose of this paper is to examine whether auditors' identification of risk factors and planning of audit tests is affected by decision aid orientation, i.e., a “negative” focus wherein client risk and its consequences are emphasized, or a “positive” focus where such factors are not emphasized. Specifically, we expect that auditors will identify more risk factors using a negatively oriented risk identification decision aid, but only when engagement risk is relatively high. We address this issue in the context of auditors' knowledge of actual clients, manipulating decision aid orientation as negative or positive in a matched-pair design. Results show that auditors using the negative decision aid orientation identify more risk factors than do those using a positive orientation, for their higher-risk clients. We also find that decisions to apply substantive tests are more directly linked to specific risk factors identified than to direct risk assessments. Further, our results show that auditors with repeat engagement experience with the client identify more risk factors. The findings of this study imply that audit firms may improve their risk management strategies through simple changes in the design of decision aids used to support audit planning.

Download Full-text

Evaluation of Physical Risk during Necropsy and Morgue Activities as Risk Management Strategy

International Journal of Environmental Research and Public Health ◽

10.3390/ijerph18168266 ◽

2021 ◽

Vol 18 (16) ◽

pp. 8266

Author(s):

Zoe Del Fante ◽

Nicola Di Fazio ◽

Adriano Papale ◽

Paola Tomao ◽

Fabio Del Duca ◽

...

Keyword(s):

Risk Factors ◽

Risk Management ◽

Management Strategies ◽

Risk Management Strategy ◽

Work Related ◽

Activity Measurements ◽

Risk Management Strategies ◽

Physical Risk ◽

Critical Issues ◽

Load Handling

Physical risk assessments allow us to understand work-related critical issues, thus representing a useful tool in risk management strategies. In particular, our study focuses on the identification of already known and emerging physical risks related to necropsy and morgue activities, as well as crime scene investigations. The aim of our study is, therefore, to identify objective elements in order to quantify exposure to such risk factors among healthcare professionals and working personnel. For the research of potentially at-risk activities, data from the Morgue of Policlinico Umberto I Hospital in Rome were used. The scientific literature has been reviewed in order to assess the risks associated with morgue activity. Measurements were performed on previously scheduled days, in collaboration with the activities of different research units. The identified areas of risk were: microclimate; exposure to noise and vibrations; postural and biomechanical aspects of necropsy activities. The obtained results make it possible to detect interindividual variability in exposure to many of the aforementioned risk factors. In particular, the assessment of microclimate did not show significant results. On the contrary, exposure to vibrations and biomechanical aspects of load handling have shown potential risk profiles. For this reason, both profiles have been identified as possible action targets for risk management strategies.

Download Full-text