Book: Financial Risk Manager Handbook Plus Test Bank
Author: Philippe Jorion
ISBN: 978-0-470-90401-5
Chapter 29 shifts from bank regulation to the investor’s problem. You take risk because you expect a return. The real question is how to balance the two across a whole portfolio. That sounds like Markowitz from Chapter 1, but Jorion updates it for how institutional money actually works today.
Book: Enterprise Risk and Opportunity Management: Concepts and Step-by-Step Examples for Pioneering Scientific and Technical Organizations
Author: Allan S. Benjamin
ISBN: 9781119288428
From Enterprise Risk Management: From Incentives to Controls by James Lam (ISBN 978-1-118-41361-6)
When Ted Koppel asked Warren Buffett what he does for a living, Buffett paused and said: “I allocate capital.” That one line stuck with me. Lam uses it to open Chapter 7, and it lands because capital allocation is not just an investor thing. Every company does it, whether they realize it or not.
Book: Structured Finance and Collateralized Debt Obligations | Author: Janet M. Tavakoli | Publisher: John Wiley & Sons (2008) | ISBN: 978-0-470-44344-6
Up until now in Wilmott’s book, we have been hedging everything. Buy a derivative, hedge with the underlying, pocket risk-free returns. Banks love it. But not everyone plays that game. Fund managers buy and sell assets trying to beat the bank rate. They take risk on purpose. Chapter 18 is about doing that intelligently.
After 20 chapters of learning about individual biases, Pompian finally gets to the big question: so what do you actually DO with all this knowledge?
We left off with Malkiel’s stock-picking rules and the suggestion to index the core of your portfolio. Now comes the rest of Chapter 15, where he tackles what to do if you’d rather let someone else do the work. And then he wraps up the whole book.
Book: Real Estate by the Numbers: A Complete Reference Guide to Deal Analysis Authors: J Scott and Dave Meyer Chapter: 37
Every investment has risks. Anyone who tells you otherwise is trying to sell you something. REITs are no different. They can be fantastic investments, but you need to go in with your eyes open.