Risk Management

Risk Management Student’s name Department: University Course: Course Code Instructor’s name Date 1 Can you provide examples of different types of financial risks that organizations commonly face, such as market risk, credit risk, and operational risk? Why would these be important to understand as managers? Financial risk management includes such activities as determining possible sources of problems and analyzing their consequences for the company, as well as selecting ways of mitigating these problems. It is important among enterprises and institutions concerning the fact that they will be able to understand the risks and, therefore, they can to a position to prepare for the impact (Pinchot et al., 2021). Companies can keep themselves safe from the negative consequences of adverse events like market fluctuation, credit default, or operational failure, should these arise by effectively managing financial risks. Types of Financial Risks and Role of the Managers for the Financial Risks 1 Market Risk: This category encompasses risks resulting from factors that adjust market supply and demand dynamics, like prevailing interest rates, exchange rates, and commodity prices. Identifying market risk is a core competency manage...