Calculated Risk Risk can be controlled but not eliminated.
A sound risk management programme is the cornerstone of safeguarding your assets. Risk management is a discipline that aims to protect investments and profits by reducing the potential for loss before it occurs. The ultimate success of your risk management effort is to preserve or improve your investment capital. The risk management process consists of four elements:

• Risk assessment — identifying and quantifying the exposures that threaten your investments and their returns;

• Loss control — reducing the frequency and/or severity of losses through preventive measures such as setting stop-loss and profit limits;

• Risk transfer — shifting the burden of loss such as diversification of asset classes so that your portfolio remains intact during crises; and

• Risk monitoring — continually assessing existing and potential exposure. Recognise the various ways you can suffer loss.


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