Shannon and Weaver Model of Communication
Shannon and Weaver model is the most popular model of communication and is widely accepted all over the world. Let us first go through the following example to understand the model better. Peter is working as Vice president – Marketing with a reputed multinational firm. He is currently heading Mike who in turn is taking […]
Characteristics and Capabilities of Successful Change Agents
Change agents act as the champions or change catalysts. The change agents may play the role of a consultant who assists the client in strategically identifying and implementing solutions for overcoming organizational problems. They play the role of a facilitator and train the client on new skills, changes in the processes, vision, mission and organizational […]
Likerts Management System
Rensis Likert and his associates studied the patterns and styles of managers for three decades at the University of Michigan, USA, and identified a four-fold model of management systems. The model was developed on the basis of a questionnaire administered to managers in over 200 organizations and research into the performance characteristics of different types […]
Organizational Learning and Change Management
Over a past few decades the concept of “Organizational Learning” has acquired increasing importance, due to rapid changes in the business environment and increasing competition. An extensive review of the Literature stresses on the fact that the organizations which build their learning capabilities can enjoy a leadership edge in the competition, can remain innovative and […]
The Business Case for Organizational Diversity
The Business Case for Diversity The articles in this module so far have focused on how organizational diversity makes eminent sense from legal compliance and value based perspectives. The discussion so far was about how organizations must embrace diversity as a value based imperative and for furthering corporate social responsibility. This article examines the business […]
In stock market there is strong relationship between risk and return. Greater the risk, greater the return generally! In financial terminology risk management is the process of identifying and assessing the risk and then developing strategies to manage and minimize the same while maximizing the returns.
Every investment demands a certain amount of risk and for an investor to assume this risk he has to be compensated duly. This compensation is in the form of something called as the risk premium or simply the premium. Risk is therefore central to stock markets or investing because without risk there can be no gains. Successful investors use stock market risk management strategies to minimize the risk and maximize the gain.
In financial markets there are generally two types of risk; first the Market Risk and second the Inflation Risk.
The inflation risk is an important consideration in long term investments where as the market risk is more relevant in the short term. It is the market risk that can be managed and controlled to a certain extent, inflation risk cannot be controlled.
There are certain strategies that can be employed to mitigate the risk in a stock market. The strategies are as follows:
Ask Warren Buffet, the greatest investor of all time, what is your advice to investors and he says ‘don’t lose money!’ But stock market connotes risk and fortunately there are enough strategies for a wise investor to safeguard his money and ensure gain. A careful and timely exercise of these options helps you see of the risk involved.
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