TYPES OF RISKS

• Project specific risk

• Competitive risk
• Industry specific risk
• Market risk
• International risk
• Project specific Risk- It is a risk that affects minimal number of
assets. This type of risk is the opposite of over all market risk or
systematic risk.
• Competitive Risk- It is the chance that competitive forces will prevent
you from achieving a goal. It is often associated with the risk of
declining business revenue or margins due to the actions of a
competitor.
• Industry specific Risk- Risks that are specific to a certain industry. For
example, the profitability of insurance company writing deferred fixed
rate annuities is more heavily impacted by large shifts up or down, in
market interest rates than industrial companies or even other
insurance company.
• Market Risk- It is the possibility of an investor experiencing losses
due to factors that affect the overall performance of the financial
market in which he or she is involved.
• International Risk- It may be defined as the possibility of loss
caused by some unfavourable or undesirable event in international
business operations. Profit and growth rates in international business
are higher but so are the attendant risk.
• Construction Risk- An construction risk can be defined as any
exposure to possible loss because every construction project is
different, each offers a multitude of varying risks.
• Supply Risk- It is the probability that an inbound supply problem will
disrupt a business. This includes issues with suppliers shipments and
markets that disrupt productions, operations, sales or project.
• Operational Risk- It the prospect of loss resulting from inadequate or
failed procedures, system or policies.
• Currency Risk- It is the possibility that currency deprecation will
negatively effect the value of one’s asset, investments, and there
related interests, and dividend payment streams especially those
securities denominated in foreign currency.