At first I want to define TRM but I do not have a one line definition. So I'll try to do a dissection of the term TRM and see what we come up with...
Trade: A basic economic concept that involves multiple parties participating in the voluntary negotiation and then the exchange of one's goods and services for desired goods and services that someone else possesses. The advent of money as a medium of exchange has allowed trade to be conducted in a manner that is much simpler and effective compared to earlier forms of trade, such as bartering. In financial markets, trading also can mean performing a transaction that involves the selling and purchasing of a security. So, trading can also refer to the action performed by traders and other market agents in the financial markets.
Risk: The quantifiable likelihood of loss or less-than-expected returns is Risk. The chance that an investment's actual return will be different than expected. This includes the possibility of losing some or all of the original investment. Risk is usually measured by calculating the standard deviation of the historical returns or average returns of a specific investment. Risk has two components:
1. uncertainty
2. exposure
If either is not present, there is no risk. In engineering, the definition risk often simply is:
Risk = (probability of an accident) X (losses per accident)
Or in more general terms:
Risk = (probability of event occurring) X (impact of event occurring)
Management: 'The group of individuals who make decisions about how a business is run' or 'The initiation and maintenance of an investment portfolio'. Management in business and human organization activity is simply the act of getting people together to accomplish desired goals. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources. Risk management is activity directed towards the assessing, mitigating (to an acceptable level) and monitoring of risks.
Financial Risk Management: The practice of creating economic value in a firm by using financial instruments to manage exposure to risk, particularly Credit risk and market risk. Other types include Foreign exchange, Shape, Volatility, Sector, Liquidity, Inflation risks, etc. Similar to general risk management, financial risk management requires identifying its sources, measuring it, and plans to address them. Financial risk management can be qualitative and quantitative. As a specialization of risk management, financial risk management focuses on when and how to hedge using financial instruments to manage costly exposures to risk.
Trading (Financial or Commodities) always involves some risk and that risk needs to be managed (minimized and still attain maximum profit), that's TRM in a nutshell. The nutshell will break and I'll try to spread the TRM knowledge much more soon!!!
Trade: A basic economic concept that involves multiple parties participating in the voluntary negotiation and then the exchange of one's goods and services for desired goods and services that someone else possesses. The advent of money as a medium of exchange has allowed trade to be conducted in a manner that is much simpler and effective compared to earlier forms of trade, such as bartering. In financial markets, trading also can mean performing a transaction that involves the selling and purchasing of a security. So, trading can also refer to the action performed by traders and other market agents in the financial markets.
Risk: The quantifiable likelihood of loss or less-than-expected returns is Risk. The chance that an investment's actual return will be different than expected. This includes the possibility of losing some or all of the original investment. Risk is usually measured by calculating the standard deviation of the historical returns or average returns of a specific investment. Risk has two components:
1. uncertainty
2. exposure
If either is not present, there is no risk. In engineering, the definition risk often simply is:
Risk = (probability of an accident) X (losses per accident)
Or in more general terms:
Risk = (probability of event occurring) X (impact of event occurring)
Management: 'The group of individuals who make decisions about how a business is run' or 'The initiation and maintenance of an investment portfolio'. Management in business and human organization activity is simply the act of getting people together to accomplish desired goals. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources. Risk management is activity directed towards the assessing, mitigating (to an acceptable level) and monitoring of risks.
Financial Risk Management: The practice of creating economic value in a firm by using financial instruments to manage exposure to risk, particularly Credit risk and market risk. Other types include Foreign exchange, Shape, Volatility, Sector, Liquidity, Inflation risks, etc. Similar to general risk management, financial risk management requires identifying its sources, measuring it, and plans to address them. Financial risk management can be qualitative and quantitative. As a specialization of risk management, financial risk management focuses on when and how to hedge using financial instruments to manage costly exposures to risk.
Trading (Financial or Commodities) always involves some risk and that risk needs to be managed (minimized and still attain maximum profit), that's TRM in a nutshell. The nutshell will break and I'll try to spread the TRM knowledge much more soon!!!
great inititiative, hope to see lot more. Good Luck!!
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