Book: Commodities: Markets, Performance, and Strategies
Editors: H. Kent Baker, Greg Filbeck, Jeffrey H. Harris
ISBN: 9780190656010
Chapter 24: Energy Risk Management (Thomas Barkley, Mingwei Liang & Andrew C. Spieler)
Book: Enterprise Risk Management: From Incentives to Controls
Author: James Lam
ISBN: 978-1-118-41361-6
Market risk is the chance you lose money when prices or rates move against you. Every company has some version of it. Banks face interest rate mismatches and trading books. Multinationals face FX when overseas cash does not match home currency needs. Energy firms feel input and output price gaps. Even pension shortfalls are market risk in disguise. GM still carried a $109 billion pension gap years after its 2009 restructuring. Ford later announced an $18.7 billion shortfall.
Book: Financial Risk Manager Handbook Plus Test Bank
Author: Philippe Jorion
ISBN: 978-0-470-90401-5
Once you have mapped your portfolio to risk factors, the next question is simple but hard: how do you turn those exposures into a VaR number? Jorion walks through three mainstream methods in Chapter 16, then spends serious time on what they miss. That second part matters more than most textbooks admit.
Book: Financial Risk Manager Handbook Plus Test Bank
Author: Philippe Jorion
ISBN: 978-0-470-90401-5
Chapter 1 is the manifesto for the rest of the book. Jorion defines financial risk management as identifying, assessing, measuring, and managing financial risks to create economic value. That last phrase matters. The job is not to eliminate risk. It is to take risks that pay.
Any smart investor, whether a billion-dollar bank or a retiree with a savings account, should know the answer to one question: how much could I lose? Chapter 19 introduces Value at Risk (VaR), the industry standard for answering exactly that.
This is Part 2 of our retelling of Chapter 3 from “Trading the Fixed Income, Inflation and Credit Markets: A Relative Value Guide” by Neil C. Schofield and Troy Bowler (Wiley, 2011, ISBN: 978-0-470-74229-7).