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Risk management and decision-making

Module information>

Academic Direction
Queen Mary University of London
Also part of
Global MBA
Modes of Study
Online

The module takes an applied perspective, concentrating on decision-making in risky environments, which is of paramount importance to the finance industry.

Study as an individual module

Apart from identification of risk sources, the module offers a detailed analysis of tools and processes designed to manage these risks which are used by the financial industry. The latter is highly sought after in the financial industry.

Topics covered

  • The Capital Asset Pricing Model
  • Value at Risk
  • Volatility, Correlations and Copulas
  • Regulatory Risk
  • Market Risk
  • Credit Risk
  • Scenario Analysis, Stress Testing and Operational Risk
  • Liquidity Risk
  • Model Risk
  • ABSs, CDOs and, the Credit Crunch of 2007

Learning outcomes

If you complete the module successfully, you should be able to:

  • describe and critically assess the processes through which companies make decisions in risky environments.
  • explain how financial instruments can be used to manage portfolio risk.
  • illustrate the following types of risk: credit, market, operational, reputational and regulatory.
  • compare risk databases and their management.
  • reason critically with respect to alternative risk management strategies.
  • assess best strategies according to an available set of information and adapt appropriate strategies once a set of information changes.
  • create the most suitable set of information for the decision-making process.
  • measure the following types of risk: credit, market, operational, reputational and regulatory.
  • professional financial tool skills and case study interpretation skills to support decisions.
  • work both independently and in teams to create and manage financial strategies.
  • present highly technical financial material to non-practitioners simply and clearly.
  • utilise real-time data to estimate the different sources of risk.
  • utilise financial tools and case studies to support strategic decisions.
  • synthesise and use information and materials from a variety of different sources to support an argument.
  • apply research skills into risk management problems and the application of these in business decision-making.

Assessment

This module is assessed by:

Coursework (50% weighting):

  • There is one item of coursework for this module which contributes to the final assessment mark for this module:
  • Coursework: a written essay of a maximum of 2,000 or 2,500 words (deadline – weeks 9-12) The coursework is designed to check student progress, extend and reinforce concepts covered and also test individual performance.

Examination (50% weighting):

  • The final piece of assessment will be an unseen written examination of 2 hours’ duration.

Essential reading

The following is provided as part of the modules materials after you register:

  • J.C. Hull, Risk Management and Financial Institution, John Wiley and Sons, 2015
  • S.L. Allen, Financial Risk Management, John Wiley and Sons, 2013
  • P. Jorion,Value at Risk, McGraw-Hill, 2006

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