Contact Us
×

Tag: risk management course

Impact Investing and Socially Responsible Finance

Posted on by Imarticus Learning

Impact investing and socially responsible finance have gained prominence as individuals seek to align their financial decisions with social and environmental values. It involves allocating capital to projects that generate both financial returns and a positive impact. It integrates social, governmental, and ecological factors into investment decisions. This addresses global issues such as education, inequality, and healthcare. 

This blog explores the different aspects of impact investing and socially responsible finance, emphasising the potential for transformative change toward a more sustainable and equitable world, and also suggests an appropriate financial services course.

Impact investing and socially responsible finance: A holistic approach

advanced program in financial services and capital markets

Impact financing and socially responsible financing are approaches that prioritise both financial performance and positive social and environmental outcomes. Impact financing refers to investments that aim to produce measurable social and environmental impacts in addition to financial income. This involves channelling capital into businesses and projects that address pressing social and environmental challenges.

A socially responsible economy, on the other hand, encompasses a wider range of economic activities that consider environmental, social, and governance (ESG) factors. This includes integrating ESG considerations into investment decisions and supporting companies that demonstrate responsible practices. These approaches allow individuals and institutions to align their financial goals with their values, thus promoting positive change while striving for financial success.

How to get involved

You can participate in efficient investing and socially responsible financing as follows: Identify your values ​​and goals:

  • Identify the causes that are most important to you and figure out your financial goals and risk tolerance and whether they align with your values. 
  • Explore impact funds, community finance institutions (CDFIs), green bonds, and social enterprises that align with your values ​​and goals. Assess their track record, performance metrics, and financial viability. 
  • Seek guidance from financial professionals who specialise in impact investing and socially responsible financing. They can help you find suitable investment opportunities and provide personalised advice tailored to your specific needs. 
  • Attend impact investing networks, online platforms, and industry events to connect with like-minded people, investors, and organisations. These platforms provide valuable insights, networking opportunities, and potential investment opportunities. Thoroughly evaluate potential investments based on financial performance, impact potential, and value alignment. Continuously monitor the progress and impact of your investments and collaborate with companies as responsible shareholders. 
  • Start with a manageable investment amount and gradually increase your portfolio over time. Diversify risk and maximise exposure across sectors, asset classes, and geographies.

Benefits of impact investing and socially responsible finance

The benefits of impact investing and socially responsible financing can be summarised as follows:

  • Financial income and risk management: 
  • Integrating ESG factors can lead to competitive financial performance. 
  • Companies with strong ESG practices are better equipped to manage risk. 
  • Effective investing offers attractive risk-adjusted returns and long-term growth opportunities.  
  • Positive social and environmental impacts: 
  • Effective investing responds to social and environmental challenges. 
  • Sustainable development is facilitated by investments in renewable energy, affordable housing, education, etc.
  • Impact investors drive social change by supporting companies that have a positive social impact. 
  • Better reputation and stakeholder engagement: 
  • Embracing impact investing strengthens relationships with stakeholders. 
  • The practice of sustainability attracts responsible investors and increases brand value.
  • Social and environmental aspects increase the loyalty of stakeholders.

Challenges of impact investing and socially responsible finance

Although impact investing and socially responsible financing offer many advantages, they also face some challenges and criticisms that need to be addressed:

  1. Measurement and standardisation of impact metrics: One of the most important challenges is the lack of consistent and universally accepted impact metrics. Different organisations and investors may use different methods, making it difficult to accurately compare and assess the real impact of investments.  
  2. Greenwashing and Impact Washing: There is concern that some companies and foundations may engage in greenwashing or impact washing by claiming to be socially and environmentally responsible without fulfilling their responsibilities. This can lead to misleading practices and undermine the credibility of leveraged investments. 
  3.  Economic income vs. social impact trade-offs: Balancing economic performance with social and environmental impact can be difficult. Critics argue that an excessive focus on financial results can undermine intended positive outcomes, while others believe that prioritising impact can jeopardise financial performance.  
  4. Lack of clear industry standards and regulations: The lack of clear industry standards and regulations hinders the effectiveness of impact investing. It can be difficult for investors to navigate the terrain and make informed decisions without definite guidelines.  
  5. Limited investment opportunities in certain sectors: Certain sectors, such as healthcare, education, and housing, have unique challenges that make it difficult to obtain lucrative financial returns. Limited investment opportunities in these areas can hinder the scalability and growth of impact investing. 
  6.  Perception of higher risks and lower financial returns: Impact investing is often seen as having higher risks and potentially lower financial returns compared to traditional investments. This perception can prevent some mainstream investors from fully embracing impact investing and socially responsible financing.

The Future of impact investing and socially responsible finance

The future for impact investing and socially responsible finance looks promising for growth. As the demand for sustainable investing options rises, more investors are expected to incorporate these in their decisions. Government and regulatory bodies are also recognising the need for responsible finance and implementing policies and incentives. These are driving the development and creation of investment vehicles in the economy.  As awareness continues to increase, impact investment and socially responsible finance can become mainstream leading to significant positive changes and a more inclusive global economy. 

Conclusion

Impact investment and socially responsible financing offer individuals and businesses a unique opportunity to achieve financial success while having a significant positive impact on society and the environment. By aligning financial goals with values, it promotes sustainability, responsible business practices, and positive social change.

The Advanced Management Programme in Financial Services and Capital Markets by Imarticus is a specialised capital market certification course in collaboration with IIM Lucknow, that provides financial professionals with the knowledge and skills to navigate this dynamic landscape. Together, we as responsible individuals, can create a fairer, more sustainable, and more socially conscious financial system.

The Role of AI ML in Asset Management

Posted on by Imarticus Learning

Artificial Intelligence (AI) and Machine Learning (ML) are now considered the next frontier of asset management. It has been under constant evolution and several technological innovations are made as per the changes posed by the asset owners. 

Even though the traditional sources of differentiation in asset management are getting commoditised rapidly, it is not completely demolished from asset management. AI and ML are providing new opportunities to extend a company’s reach in the global market for cost reduction and efficient operations. 

Many big corporate sectors are now leaning towards making AI and ML the next frontier of asset management. In this article, let’s learn in detail about the significance of AI and ML in asset management. 

What is Artificial Intelligence (AI) and Machine Learning (ML)? 

investment banking course

Artificial Intelligence is a branch of computer science that deals with building potent and smart machines that are capable of performing tasks like humans. It encompasses a wide range of techniques and methodologies to enable assets and machines to learn, reason and make informed decisions based on the data. 

Machine Learning is one of the branches of Artificial Intelligence, which is now shifting paradigms of every sector in the tech industry. It primarily focuses on using varied data and algorithms to imitate human intelligence. Machine Learning or ML is now considered the future of the tech industry, which is trying to improve its accuracy gradually. 

Trends of AI and ML 

Artificial Intelligence and Machine Learning are transforming the society at large. Addressing the elephant in the room, ChatGPT is now the newest AI language model that has taken over the world. This has predominantly enhanced the course of modern search engines. 

However, there are various trends AI and ML are working on, which would be a great asset when it comes to asset management. Let’s see what they are.

  • AutoML 

AutoML or Automated Machine Learning, is one of the most promising aspects of AI branches. It helps improve construction reporting and automatically tunes the net architectures of a software industry. 

AutoML is a neural network model that facilitates tuning and helps reach the market cost-efficiently. It is also a fast way that provides promising solutions and is the latest AI and ML trend in 2023. 

  • AI-enabled Designs 

AI is generally known to streamline procedures primarily related to data, image and linguistic analytics. Recently, OpenAI has developed new models combining languages and images to generate conceptually new designs using the prompts. The AI-enable conceptual designs are ideal for healthcare, IT, retail and finance industries.

  • AI-based Cybersecurity 

With the emergence of new cyber threats every day, the development of cybersecurity has now become crucial to sustain in society. AI and ML are playing a growing role in determining and responding to the newest cybersecurity threats. Organisations are now integrating AI to proactively defend the security curve and not suffer a higher rate of negative impacts. 

  • Bias Removal in ML 

As enterprises are adopting AI gradually, the challenge of AI bias is now a genuine concern. It refers to refers to the potential for machine learning algorithms to produce discriminatory or unfair outcomes due to biased data or biased model training. 

To address this concern, efforts are being made to remove AI bias. This will help in making objective predictions and people are not discriminated against on any grounds of medical treatment, product buying or applying for loans. 

Role of AI and ML in Asset Management 

Asset management has been integrated with technology for decades and has come up with a variety of uses. As technology is revolutionising, the asset management sectors are now incorporating AI to upscale their business. Here are some ways one can identify the roles of AI and ML in asset management. 

Improving UI 

Companies involved with asset management are utilising UI or user interfaces at great lengths to gain a large number of audience. With the help of artificial intelligence, companies can enhance their connectivity and achieve goals. This also enhances their client service, data analytics, production and technology. 

Operational efficiency 

AI and ML enable predictive maintenance, identify maintenance needs, reduce asset downtime, and optimise maintenance activities. They also help in detecting potential issues, optimising asset allocation for better utilisation and improving demand forecasting for efficient company operations. 

Investment procedures 

Investment procedures also incorporate AI and ML for pre-trade analysis. These technologies are used to get data-driven insights for informed decision-making, assessing and managing investment risks effectively. AL and ML help asset managers to use advanced analytics and automation for improved investment performance. 

Conclusion 

Asset management has now become a crucial part of both business and personal purposes. Therefore, incorporating advanced technology to modulate assets has become vital.

If you are interested in learning about asset management and other aspects of financial markets, check out Imarticus Learning’s Certified Investment Banking Operations Professional course or CIBOP course. You can build a potent career with this course in investment banking. 

To know more, check out the website right away. 

What is disaster risk management?

Posted on by Imarticus Learning

Risk management is a crucial aspect of any business or organization. It involves identifying potential risks, assessing their impact, and taking steps to minimize or mitigate them. Risk management has become more critical than ever in today’s rapidly changing and increasingly complex world. Organizations must be prepared to deal with a wide range of threats, from natural disasters to cyber-attacks. By implementing a solid risk management plan, organizations can reduce their exposure to risk and increase their resilience in the face of unexpected events. In this blog, we will explore the principles of risk management and provide practical tips and strategies for building a robust risk management program.

Risk management has become famous for several reasons, some being:

  1. Increased regulations in various industries requiring formalized risk assessment.
  2. Greater awareness of the impact of risk events, such as natural disasters, cyber-attacks, and financial crises.
  3. The recognition that proactive risk management can improve overall performance and decision-making.
  4. The growth of complex and interconnected systems makes it harder to predict and mitigate risks.

Some Basic Principles of risk management:

The principles of risk management can be broken down into several key components:

  1. Risk identification: The process of identifying potential risks to an organization’s goals and objectives. This involves a comprehensive assessment of all potential threats, including internal and external factors.
  2. Risk assessment: The process of evaluating the likelihood and impact of identified risks and determining the priority of each risk in terms of its effect on the organization.
  3. Risk mitigation: The process of taking steps to reduce the likelihood of a risk event occurring or to minimize its impact if it does happen. This can include implementing controls, transferring risk to a third party, or accepting the risk.
  4. Risk monitoring and review: The ongoing process of tracking and reviewing the effectiveness of risk management processes and making necessary adjustments to the risk management plan.
  5. Communication and collaboration: Effective risk management requires effective communication and collaboration between all stakeholders, including management, staff, and external partners.
  6. Continuous improvement: Risk management is an ongoing process, and organizations must continually review and improve their processes to ensure they remain effective and adapt to changing circumstances.
  7. Integration with organizational processes: Risk management should be integrated into all aspects of an organization’s operations, from strategy development to day-to-day operations.
  8. Ethics and fairness: Risk management must be conducted ethically and fairly, considering the interests of all stakeholders, including employees, customers, and the wider community.

Tips and strategies to build a robust risk management program:

  1. Establish a risk management framework: Define a clear and structured process for identifying, assessing, and mitigating risks, and ensure that this framework is integrated into all aspects of the organization’s operations.
  2. Involve all stakeholders: Encourage the active participation of all stakeholders, including management, employees, customers, and external partners, in the risk management process.
  3. Perform regular risk assessments: Regularly assess the organization’s risk profile and adjust the risk management plan as necessary.
  4. Monitor and review risk management processes: Monitor and review the effectiveness of risk management processes and make any necessary changes.
  5. Foster a risk-aware culture: Promote a risk-aware culture within the organization by raising awareness of the importance of risk management and encouraging all employees to be proactive in identifying and managing risks.
  6. Use technology to support risk management: Utilize risk management software to automate and streamline the risk management process, providing real-time data and insights to support decision-making.
  7. Collaborate with external partners: Collaborate with external partners, including insurance providers, auditors, and regulatory bodies, to ensure that the organization’s risk management processes are comprehensive and practical.
  8. Continuously learn and improve: Stay up-to-date with developments in risk management best practices and constantly improve the risk management program to ensure it remains effective in an ever-changing landscape.

Learning and Transforming with Imarticus Learning:

investment banking course

If you have been looking for banking courses after graduation, Imarticus Learning offers Certified Investment Banking Operations Professional Course that is an excellent way to learn investment banking. This industry-approved program is best for new learners and offers 100% job placement. Through this course, you learn essential financial markets concepts such as trade life cycle, risk management, and regulation and prepare for a job at a leading company.

The module helps understand the nuances of financial markets and financial products.

Course USPs:

  • Tailored to training programs with placement support 
  • Supportive program to achieve unique career goals.
  • Learn fundamentals of financial markets, trade life cycle, risk management, and regulation and gain practical knowledge.
  • Understand the Financial Market Landscape from expert faculties
  • Gain insights into different Financial Instruments

For further details, contact the Live Chat Support system or visit one of our training centres in Mumbai, Thane, Pune, Chennai, Bengaluru, Hyderabad, Delhi, Gurgaon, and Ahmedabad.

Risk Management – A Passage to Performance Assessment

Posted on by Imarticus Learning

Risk management is the process of identifying, assessing, and controlling potential risks and hazards to a business or organization. It is the cornerstone of any successful business venture, as it can help protect a company from unforeseen losses and other negative consequences. But risk management is much more than just preventing financial loss; it also helps assess an organization’s performance. Whether you’re an established business or just starting out, understanding risk management can be crucial in ensuring that your operation runs smoothly and efficiently. In this article, we will explore how risk management can be used to inform and refine performance assessment.

Why is risk management more important than anything else in 2023?

best investment banking course with placement in India

Companies are expecting more stringent regulation in the wake of the Covid-19 pandemic. In particular, they are looking at how they will be assessed for risk in the future. The current risk management landscape needs to be more cohesive and often siloed, with different teams managing different risks. This makes it difficult to get a holistic view of risk and make informed decisions about where to allocate resources.

In 2023, risk management will be more critical than ever as companies face increased scrutiny from regulators. A comprehensive and integrated approach to risk management will be essential for companies to protect themselves from potential liabilities.

How does risk management work, and what are the basic work principles of risk management?

To answer the question of how risk management works, it is essential first to understand what risk management is. Risk management is the process of identifying, assessing, and managing risks to minimize their impact on an organization. It includes proactive and reactive measures to protect the organization from potential hazards.

The basic principles of risk management are:

Identifying risks: The first step in risk management is identifying potential risks that could affect the organization. This can be done through various methods, such as brainstorming sessions, literature reviews, or data analysis.

Assessing risks: Once potential risks have been identified, they must be evaluated in terms of their likelihood and potential impact. This will help prioritize which risks should be addressed first.

Managing risks: The final step in risk management is implementing measures to mitigate or eliminate the identified risks. This may include changes to organizational policies or procedures, implementation of new technologies, or training employees on handling potential risks.

Why should you make a career in risk management?

There are many reasons why risk management is an excellent career choice. Here are just a few:

  1. Job security: Companies and organizations in all industries recognize the importance of managing risks, and as a result, demand for skilled risk management professionals remains high.
  2. Good earning potential: Risk management professionals are well compensated, and their salary increases with experience and skills.
  3. Opportunity to have an impact: A career in risk management allows you to play a crucial role in protecting an organization from potential threats and losses. This can provide a sense of purpose and satisfaction.
  4. Growing demand: The increasing complexity of the business world, including global interconnectedness and rapidly changing technology, has led to a growing demand for risk management professionals.
  5. Diverse industries: Risk management is necessary for all sectors, from finance and insurance to healthcare and government, providing a wide range of career opportunities.
  6. Use of diverse skill set: A career in risk management involves a mix of technical and soft skills such as critical thinking, communication, data analysis, and problem-solving. This provides a challenging and dynamic work environment.

How can a professional banking course after graduation and investment banking help you gain insights into risk management?

A banking course after graduation and investment banking can help you gain insights into risk management and performance management. Risk management is the process of identifying, assessing, and managing risks to an organization’s capital and earnings. Performance management is the process of assessing, monitoring, and improving the performance of individuals and organizations. Both risk management and performance management are important tools for ensuring the success of any organization.

Setting on a New Journey with Imarticus Learning:

Suppose you are looking for a flagship industry-approved program. In that case, Certified Investment Banking Operations Professional (CIBOP) is a short course designed to transform students with under three years of experience into an investment banking operations experts with a 100% job interview guarantee. This extensive 150-hour program teaches you the fundamentals of financial markets, trade life cycles, risk management, and regulation. The course is meant for finance graduates with 0-3 years of work experience.

Course USPs:

  • 100% Job Interview Guaranteed!
  • 150 Hours Course Duration
  • 1000+ Batches Completed
  • 40000+ Placements
  • 5 LPA Average Salary
  • 60% Salary Hike for working professionals
  • 500+ Hiring Companies

For further details, contact the Live Chat Support system or plan a visit to one of our training centres in Mumbai, Thane, Pune, Chennai, Bengaluru, Hyderabad, Delhi, Gurgaon, and Ahmedabad.

13 Tips For Risk Management. A Balanced Approach To Training

Posted on by Imarticus Learning

Be it a startup or a multinational corporation, the risk is an indomitable part of the business. Risk always comes unannounced and hampers the integrity of businesses, whether it is a financial crunch or cyberattack.

To address such unforeseen situations, companies often devise risk management strategies and plans. Implementing risk management training into company culture helps to reduce massive damage and protects a company’s financial assets as well as its reputation. 

What is risk management?

 

Risk management is the process of identifying, assessing and controlling any kind of risk within a company. These unforeseen events can occur from a variety of sources, which include legal liabilities, natural disasters, financial failures and strategic management errors, among many others.

Most common business risks

Despite investing energy and hours, some situations in business are unavoidable. The most common business risks are:

  • A breakdown in the supply chain or an error in the logistics can pile up problems and drain finances.
  • Poor product quality, financial discrepancies or bankruptcy can lead to the loss of the reputation of a company.
  • Implementation of new technology and unable to use it tactfully can drain wealth.
  • Advancement in technology has led to the rise of cybercrime, data breaches and hacking.
  • Inflation, stock volatility or economic depression runs the risk of ruining a company.

13 risk management training tips

Over the years companies have hatched several strategies to mitigate risks by incorporating risk management training. Some of the best methods are:

Data analysis

Organisations must collect and analyse data in a thorough manner, as it is one of the key elements in risk assessment and management. For example, to prioritise a short list of potential risks on a project that requires immediate attention, qualitative risk analysis is used. Addressing, monitoring and re-evaluating these risks become a top priority.

Business experiments

A great way of risk management training is the introduction of business experiments in the company culture. This refers to the “what-if” scenario, which is often included to gauge potential risks in various departments. It can also be a great way to compare and explore alternative plans in these changing times.

MVP development

Minimum Viable Product (MVP) refers to the development of a strategy using core features and modules that can cater to the maximum number of customers without any hassle. Developing an MVP is a smarter move than a complex strategy that has many features, as it often becomes a financial burden and moves beyond the scope of feasibility.

Building in buffers

Buffer plays a crucial role when it comes to risk management as it gives organisations the freedom to tackle unforeseen situations. A buffer can consist of human resources, financial resources or additional time, which can be employed according to the demands of any given project.

Clear about roles 

Discrepancies often occur and lead to risk when there is a gap in communication about the designated roles and responsibilities in an organisation. It must be a top priority to ensure everyone knows their tasks in an organisation to increase efficiency and reduce risks. 

Risk reward analysis

Before investing time, money or resources in any project, companies often calculate the risk versus reward to understand the drawbacks and benefits of a particular initiative. This not only helps to better prepare for minimising risk but also aids in understanding what tasks lie ahead.

Implementing best practices

Best practices should always be highlighted and implemented properly, as these are tried and tested methods that can help companies reduce risks. Though it may vary from industry to industry, best practices provide a risk cushion for companies, and they do not have to start from scratch.

Lessons from the past

Every project or initiative teaches an organisation something. These lessons become invaluable tools for future projects or undertakings, which can help reduce risk appropriately. Documenting, discussing and developing strategies based on these findings can be helpful.

Identify risks early

The best way to isolate and identify risk at a nascent stage is by asking the right questions before the start of any project. Organisations should also monitor early warning indicators (EWIs) and develop action plans in response.

Theory validation

Companies should use questionnaires and surveys to get feedback from users on their risk management strategies. This could be helpful to understand the design flaws and potential challenges and manage the risks in a better manner.

Monitoring and reviewing

Companies must continuously monitor the type of risk as changing scenarios bring new challenges every day. This allows them to stay updated and act proactively when the situation calls for it.

Take responsibility

Employees of an organisation must have the training and freedom to flag or sort out a problem on their own if they find any discrepancies like fraud, safety issues or security breaches.

Tailored insurance 

Organisations should understand the types of potential risks they can face and try to get tailored insurance. Having cookie-cutter insurance may not cover all the risks.

Conclusion 

Effective risk management training is necessary for every company, as it is one of the most important pillars of risk management. It helps organisations reach their true potential and explore new opportunities. If you are thinking of enrolling in a risk management course, check out the IIM Lucknow Finance Course offered by Imarticus.

The subtle art of risk management: 2023 edition

Posted on by Imarticus Learning

In investment banking, risk management is an essential practice. Management of risks means prioritising the risks on an asset, recognising what kind of risk it is, and assessing how it can be managed. 

Since the outcomes are uncertain, the post-assessment session is followed by a coordinated effort to lessen the impact of failure. At the same time, it has to be a cost-effective solution. 

This way, an investment banker ensures that resources are optimised enough to reduce the risk, lessening it to almost zero value. They monitor the asset in such a manner that they manage the likelihood and increase the probability of success.

What the art and the science of risk management are all about?

Investment banking has always been a risky field. Thus, the whole sector has been built on risk management. 

You can take a calculated risk when investing money into an asset or a company. You need to be extremely calculative about handling the risk, and you should be able to mark the right time to exit. 

Simply said, the risk needs to be managed effectively to increase the probability of success in investment banking. In other words, if you can completely eradicate, evade and suspend risks to minimise the detrimental effects, you can maximise your success percentage. These are some techniques you will be taught when you learn investment banking.

Risks investment banking institutions face

An investment bank invests in several securities in different markets. Here are some of the risks they are prone to:

Market risk

These are the most common risks that are unavoidable. This is why risks associated with the market are one of the biggest concerns for investment banks worldwide. These risks comprise the losses due to various factors because of the variables that exist in the market. Some examples are inflation, exchange values of the country’s currency, inflation, and interest rate risk.

External risk factors

These are called credit risks, which are external factors. Credit risks occur mainly when an investment banking organisation fulfils the intermediary role for over-the-counter trades. 

These risks come into effect if the transaction counterparty becomes a payment defaulter. This can also happen if the client fails to pay the principal or the interest after receiving financing from a bank or lending institution finance. To manage such risks, the banks should run a rigorous loan eligibility process where a qualified and reliable candidate should get the fund offering.

Principles of risk management

best investment banking courses with placement in India

The risk management principles apply to every walk of life. Not only just business or investment banking but any activity with some speculative element to it could also use these risk management principles.

Overall, there are three principles of risk management. They are also helpful in understanding the drivers of risk management. They are as follows:

  • Identifying and tracking the risks which have been emerging
  • Development of strategies that can efficiently mitigate the risks
  • Supporting corporate strategy and improving the decision-making process

Identifying and tracking emerging risks involves finding out the risks that are up-and-coming and could affect the investment strategy of a large financial corporation.  

The Strategy development for risk mitigation is obviously the measures they take to minimise the risk. The Corporate strategy and enhancement of the decision-making process is the organisational protocol to manage the risks.

Therefore, they should also improve their practices and focus on increasing their safety net by identifying the key priorities for the next year, 2023 and starting afresh. Also, they find out the areas which could aid their profitability to cushion all the adverse effects. 

The legal and compliance work should also be completed, as focusing on these will eliminate unwanted risks. The leaders of financial agencies must also learn to prioritise developing additional capabilities for efficient risk management. This way, every organisation or institution is prepared to meet all kinds of evolving risks.

This was one of the few topics that will be taught you in Imarticus Learning’s investment banking courses after graduation. You will also learn the nitty-gritty of investment banking from the best faculty in India. After completing the course, you can also get placement with the top companies in India. 

For more information on investment banking, just like the one you have read, subscribe to our blog and newsletter. 

The ABCs Of Risk Management Training

Posted on by Imarticus Learning

The ABCs Of Risk Management Training

Do you want to be involved in your company’s risk management efforts? Would you like to help prevent or reduce the consequences of an accident, incident, or problem for your company and its customers? If so, then training is the way forward.

Risk Management: An Overview

Risk management is a process that helps organizations identify, assess, and control risks. It’s a systematic approach to identifying and analyzing risks and opportunities.

Risk management involves managing uncertainty by:

  • Identifying potential threats or hazards
  • Analyze the risk
  • Decide how you will respond to it if it comes to pass
  • Controlling risks through strategies such as reducing exposure, limiting harm, or avoiding the problem altogether (mitigating).

What is Risk Management Training?

e-learning training programs

Risk management training is a course that helps people understand and manage risks in their organization. It’s not just about having the latest technology or software; it’s also about understanding what risk management is and how it works so that you can make intelligent decisions about your business.

The ABC of Risk Management Training

Risk management training train employees in identifying, assessing, and managing risk. It is a process that helps organizations understand the potential impact of risk and how to manage it. Risk management training helps employees make better decisions about risk and helps them avoid risks.

 

  • The risk assessment process

 

The risk assessment process is the first step in the risk management process. It involves identifying risks, assessing their impact, and determining how to mitigate them. You can use it through a variety of methods, including:

  • Risk assessment – To decide whether or not a particular activity or situation is risky, you must first identify what constitutes “risk” or “dangerousness.” 
  • Risk mitigation – Once it’s determined that something presents an unacceptable threat to your organization’s assets/resources/people, it becomes necessary to implement measures.

 

  • Risk mapping

 

Risk mapping is the process of identifying, assessing, and prioritizing risks. The most important thing to remember about risk mapping is that it’s a continuous process. While you may have identified all your risks as part of your risk management plan, you should be revisiting those same risks on an ongoing basis. 

 

  • Enhancing your compliance program

 

Compliance programs are essential for the success of a business. Compliance programs help ensure that a company complies with laws and regulations, which helps avoid penalties and fines. Compliance programs also help companies to reduce risk by implementing measures that prevent issues from arising in the first place.

 

  • Residual risk analysis

 

The residual risk analysis identifies and evaluates risks that cannot be eliminated or mitigated. It’s essential to remember these unplanned events because they can cause severe damage to your business if they occur without proper preparation.

So there you have it! The ABCs of risk management training. 

Discover Financial Services and Capital Markets course with Imarticus Learning

Our IIM Lucknow executive program will teach students about investment banking, capital markets, risk management, and fintech. This demanding six-month program was created at IIM Lucknow by the top business school in the world. 

Course Benefits For Learners:

  • This financial management course allows students to network with peers and business professionals.
  • Students will comprehend crucial ideas like investment banking, capital markets, risk, and fintech.
  • The financial services management certification will teach students about financial services and capital markets.

 Visit our training centers in Mumbai, Thane, Pune, Chennai, Bengaluru, Delhi, Gurgaon, or Ahmedabad, or get in touch via the chat support system.

Related Articles 

https://imarticus.org/financial-industry-overview-capital-markets-and-financial-services/

https://imarticus.org/everything-youve-ever-wanted-to-know-about-iim-finance-courses/

Risk Management: Meaning, Features, And Importance

Posted on by Imarticus Learning

Risk Management: Meaning, Features, And Importance

Risk management is discovering, evaluating, and controlling risks to an organization’s resources and profits. These dangers can get caused by several things, such as financial unpredictability, legal responsibilities, technological problems, strategic management blunders, accidents, and natural calamities.

An effective risk management program aids a business in taking into account all potential hazards. Risk management also examines the link between risks and the possible adverse cascade effects on an organization’s strategic objectives.

Risk management programs aim to protect and enhance corporate value by taking calculated risks rather than completely eradicating all risks.

Risk management: what is it?

The detection, analysis, and reaction to risk elements that are inherent in a business’s operations are all included in risk management. Effective risk management is acting proactively rather than reactively to influence future events as much as feasible. As a result, sound risk management can lessen the likelihood of a risk happening and its possible consequences.

training and development

Every company that operates in the market encounters several sorts of dangerous and unforeseen occurrences that might even result in the permanent closure of its activities. Risk is a component of the investment world that cannot be isolated. It is a necessary action that the investor must conduct to achieve growth, profit, wealth, and progress. 

For business people to increase their earning potential and reduce their exposure to various financial hazards, careful preparation and research are essential. Financial risk can take the shape of bankruptcies, volatile stock markets, recessions, elevated inflation, etc. To manage all unplanned and undesirable occurrences, firms of all sizes-small, medium, and large—practice risk management. 

Features of a risk management system 

Your company’s divisions and stakeholders will need to be able to swiftly and readily evaluate information to look for warning signs since they have various risk concerns. Data must be punctually given, updated in real-time, and demonstrate synergy between different risk areas to be effective; yet, inundating colleagues with voluminous and pointless information is likely to make it useless. 

Risk detection is excellent, but to truly enhance operations over the long term, you must understand the root causes and initiate events that gave rise to the risks in the first place. 

Importance of Risk Management

Risk management is essential because it allows companies to recognize and effectively address possible threats. A risk is simple to mitigate once it gets identified. Additionally, risk management gives a corporation a foundation on which to make wise decisions.

The most fantastic method for a firm to be ready for potential events that may arise during advancement and expansion is to identify and manage risks. 

Learn investment banking courses with Imarticus Learning

best capital markets course

With the Certified Investment Banking Operations Professional curriculum, students may jumpstart their careers in banking. This certification in investment banking will give students the skills necessary to succeed in banking operations, treasury, and clearing services at all production levels.  

The investment banking courses with placement cover Strategic planning and financial management, financing, and valuation of investment opportunities. 

Course Benefits for Learners:

Contact us through chat support, or drive to one of our training centers in Mumbai, Thane, Pune, Chennai, Bengaluru, Delhi, Gurgaon, or Ahmedabad.

Not Knowing Risk Management Can Be Risky

Posted on by Imarticus Learning

Not Knowing Risk Management Can Be Risky

Investment decisions are like a two-sided coin. If one side of investment is in return, the other is a risk. Uncertainty or risk is present in all investment decisions. An investor takes all investment/portfolio decisions based on his risk-return profile. If you are a conservative investor, you will buy investment assets with low volatility or potential loss probability. If you are an aggressive investor, you will purchase investment assets that have the potential to earn higher returns but are also accompanied by a higher proportion of losses. If you wish to pursue a career in corporate banking or investment banking, taking risk management courses is essential.

Definition of Risk and how risk is measured 

When you do risk analysis, you identify, analyze, and accept uncertainty to mitigate them. As mentioned before, risk includes both upside deviations and downside deviations.

Measuring Risk

Risk measurement varies according to the type of financial investment. Here, we analyze the risk associated with stocks, fixed income securities, investing in foreign exchange denominated instruments, and risk arising from companies’ operations. The risk associated with each type of investment is analyzed in a separate sub-section.

I. There are two measures of risk used in the investment analysis of stocks:

  • Standard Deviation: 

Risk is normally measured by standard deviation. As you know, standard deviation measures variances on the upside and downside of the arithmetic mean. Standard deviation is a measure of dispersion or variation around the measures of central tendency. Standard deviation measures portfolio risk. Portfolio risk can be classified into systematic and unsystematic risk. Outliers and extreme values can impact standard deviation. It also rates positive variations or deviations from the arithmetic mean as risk and assumes that a normal distribution captures the entire distribution of returns.

  • Systematic Risk: 

It measures market risk or risk inherent in the entire market or the market segment. This risk cannot be diversified away through careful stock picking. This risk affects the market, not a particular stock or industry segment.

  • Unsystematic Risk:

 This is a risk inherent in a particular company or industry segment. This can be diversified through careful Financial Analysis to weed out non-performing stocks or industry sectors. Stock selection helps in this process if stocks are added to the portfolio after careful financial analysis. Concentration risk happens when you invest a disproportionate amount in single security leading to unsystematic risk.

  • Beta: 

This is the risk that security returns variations or fluctuations move in tandem with market volatility and fluctuations. Returns of Market indices like Sensex 30 and Nifty 50 measure market returns. Beta is measured by the covariance of security returns and market returns. Beta estimates systematic risk or market risk.

II. Investing in fixed-income instruments comes with its own set of risks.

  • Interest-rate Risk:

Interest rate risk is the key risk when investing in bonds and other fixed-income investments and mutual funds. This is the risk that market interest rates change after investing in a particular fixed-income security. Interest rates and bond prices have an inverse relationship. Interest rate affects you when you undertake bond trading as you may have purchased a bond at a premium but are forced to sell it at a discount before maturity. Interest rate risk is measured by duration, which is the first derivative of the change in prices in response to changes in the market interest rates.

 

  • Credit Risk: 

 

This is the risk that the company does not make payments of the interest and principal repayments due on the bond. The company may be facing adverse financial circumstances and may be forced to default. Credit rating agencies periodically analyze credit risk and future outlook for the company as it impacts interest and principal payments. They provide credit ratings for the long term and short term, which signal the outlook for the company’s financial position.

III. Risk of investing in foreign exchange denominated instruments

1) Exchange Risk: 

Suppose you have invested in foreign exchange denominated securities, whether equity or debt. Your investments will be subject to exchange risk when the investments are valued at the market currency exchange rates for the home currency. Exchange risk, determined by relative interest rate movements, can positively impact portfolio valuation.

IV. Companies suffer from operational risk and financial risk.

1) Operational risk

This arises from the operations of the company and is measured by the variability of the Earnings and profits of the company.

2) Financial Risk: 

This is a risk that arises from the financial leverage that the company has undertaken. Simply put, this refers to the proportion of debt to equity and the impact of interest cash flows on the profitability of the company.

Risk Management

When you study risk management, you study the totality of risks that affect an organization or an enterprise. As an investment banker, you need to analyze the various types of risks affecting the investment portfolios of your clients and the ultimate portfolio impact. Doing risk management courses is a must if you wish to pursue an investment banking career. Whether it is corporate or investment banking, risk management in banking becomes of the utmost importance, and knowledge of risk management is crucial. Knowledge of portfolio diversification, asset allocation, and hedging techniques is important to diversify your client’s risk.

Imarticus learning Pvt Ltd  can be of great help to you in this regard. Contact us through chat support, or drive to our training centers in Mumbai, Thane, Pune, Chennai, Bengaluru, Delhi, and Gurgaon. 

Why are Risk Management Courses Gaining Popularity?

Posted on by Imarticus Learning

Why Are Risk Management Courses Gaining Popularity?

A business landscape always consists of some risks that are to be solved. Business organizations have to deal with external and internal risks that can affect the ROI (Return on Investment). The same applies to the investment banking and finance sector. Banks have to mitigate several risks to boost their growth and ROI. It is why banks look for risk management experts that can help them operate smoothly.

Many young graduates are looking for risk management courses that can help them get into the industry. Continue reading to know why risk management courses are gaining popularity in 2022.

Risk management in investment banking

Risk management is one of the core functions in the investment banking industry. Before an investment, banks have to analyze the risks associated with the investment. If an investment opportunity possesses several risks, it can be challenging to go on without eliminating them.

If investment banks do not address the risks proactively, they might experience a significant decline in ROI and market reputation. Risks can be of many types depending on the market, internal organization, etc. Anything that can leave a negative impact on the bank can be considered a risk.

Risk management is a continual process that requires daily effort. Global investment banking is having trouble finding risk management experts that could work proactively. It is why investment banks are looking for highly skilled individuals that can forecast risks and mitigate them proactively. Young graduates and investment bankers are looking for risk management courses that could teach them industry skills.

Why risk management is necessary for investment banks?

You must have heard about the market disruptions caused by the recent COVID pandemic. Finance firms that could not address the challenges of the COVID pandemic failed to survive. Banks and financial institutions should include risk management strategies into their day-to-day operations.

Investment banks focus on risks that could make them lose securities or money. Banks also assess risks so that their clients may not face loss. It is impossible to survive in the current scenario without addressing the risks proactively.

Types of risks encountered in the finance sector

Finance firms have to tackle several risks that could hamper their ROI and reputation. Some common types of risks that should be managed are as follows:

Market risks

Market/macro risks arise due to changes/disruptions in the market. For example, investment banks are affected by the inflation rate, interest rate fluctuation, exchange rate fluctuation, and several other factors. Market factors should be closely monitored by the investment banks to discover potential risks.

Liquidity risks

If an investment bank fails to sell securities at a profitable price, it could encounter a loss. Due to liquidity changes in the market, investment banks might face challenges while selling/buying securities.

External risks

Banks and financial institutions have to deal with fraud and credit risks. If a client cannot fulfill their promise, the reputation of the banks is at stake. Reinvestment risks, horizon risks, and many other risks fall under the category of external risks.

How to learn more about risk management in 2022?

Considering the current scenario of the COVID pandemic, it is better to learn risk management via an online course. We at Imarticus Learning offer a unique risk management course that could make you job-ready. Our CIBOP course deals with several aspects of risks management in the industry.

The industry-endorsed CIBOP program is also backed by the London Stock Exchange. With an industry-recognized certification, you can find a job with any premier investment bank. You will also receive placement support from us during the CIBOP program. Start learning risk management in banking with the CIBOP course now!