Questions tagged [risk-management]

Risk management is the process of identification, analysis and acceptance or mitigation of uncertainty in investment decisions.

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What are the ways to price a holding company?

I would like to know how people value holding companies. I guess the most famous one is Berkshire ($BRK.A - $BRK.B). And others exist. These holdings usually have a lot of exposure to realestate, PE ...
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Do the rewards of custom contract size in OTC derivatives justify the counterparty risk?

If I decide to trade OTC derivatives, I take on counterparty risk. Since the transaction is not overseen by a clearing house/firm, I accept the risk that the counterparty may not honour the obligation....
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Forward Contract Extension

I was reading this article Below is a small snippet from the article. I'm wondering how Barrick gold could extend the hedge at its own option. How would this be executed and how do they have this ...
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How to LAY/SHORT SELL multiple mutually exclusive outcomes in sequential events?

(n.b. Still not sure if this is the right place, but it was suggested by @SRKX) How would I calculate the percentage of my wealth to invest when LAYING/SHORT SELLING multiple mutually exclusive ...
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1answer
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Forward contract hedge and market-maker

Referring to Mcdonald's "Derivatives markets" book, a market-maker or arbitrageur must be able to offset the risk of a forward contract. It is possible to do this by creating a synthetic forward ...
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Finding Uncorrelated Assets

I own a particular security. How can I find another security, which has uncorrelated or negatively correlated (anti correlated) returns with the one I already own? I would like both securities to ...