Risk Management – The Basics

12 Pages Posted: 27 Oct 2018 Last revised: 20 May 2019

Date Written: October 4, 2018


The article clarifies the most essential methods for risk management.

This includes especially the methods for identification, quantification and simulation based risk aggregation (e.g. monte carlo simulation). It is pointed up that an appropriate quantification of all relevant risks and a risk aggregation by the monte carlo simulation are both crucial for an efficient risk management.

Also an impression of the basics for the organization of risk management systems is given and the main aspects of risk coping and risk control are explained.

Overall, a modern, „decision-oriented“ risk management is portrayed which is able to predict changes due to decisions in the risk-return profile of the company already during the process of preparing those decisions (e.g. in terms of investment or acquisitions).

Keywords: risk management, decision-making, decision

Suggested Citation

Gleißner, Werner, Risk Management – The Basics (October 4, 2018). Available at SSRN: https://ssrn.com/abstract=3260534 or http://dx.doi.org/10.2139/ssrn.3260534

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