Financial Risk Management

Course details

The management of financial risk is vital for all companies as these risks have the potential to cause a company to collapse if they are not identified and mitigated. This financial risk exists in many forms, for example, currency risk, commodity risk, interest rate risk, funding and liquidity risk, and credit risk.

The course identifies sources of financial risk and examines how these risks can be assessed and quantified. It recommends and justifies techniques and tools to mitigate the risks in different situations and within the context of a risk management framework. Many of these techniques involve the application of financial derivatives. Therefore, you will examine common uses of forwards, options, interest rate and currency swaps, and credit default swaps. You will look at how these derivatives are priced, how their values are affected by external factors, and how their use gives rise to operational and counterparty risks.

You will work on case studies throughout the course to illustrate practical applications of the course material. The cases are based on real-life companies exposed to financial risk and show the risk management solutions they apply. The companies are drawn from a variety of sectors such as oil and gas exploration and production, airlines, airports, agriculture, engineering and retail.