Market Risk Management - Equity Risk

Описание: The sources are mainly about the nature of stocks and the analysis of the risks associated with them. Both texts explain that stocks represent ownership in a corporation and are more difficult to value than bonds due to the uncertainty of dividend decisions. The main types of risk include Market risk, Interest rate risk, Financial risk (leverage) related to the financial condition of the firm, and Business risk related to the company's operations. Three main methods for measuring risk are presented: Standard Deviation (Volatility), Beta (Systematic risk), and Value at Risk (VaR). In addition, the texts introduce concepts such as the Capital Asset Pricing Model (CAPM) and the Capital Market Line, emphasize the importance of diversification, and show how Beta measures systematic risk.

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