Financial Risk Management

Course Description

Financial risk management course is designed to provide Students with a thorough understanding of financial risks, encompassing various dimensions such as market, credit, operational, and liquidity risks. The content is structured to equip students with the necessary skills and knowledge to identify, assess, and mitigate risks in the complex landscape of financial markets. Additionally, the course delves into the realm of enterprise risk management and explores emerging trends shaping the financial risk management landscape. 

Course objectives

The course will be guided by the following objectives:

1. Develop a comprehensive understanding of various types of financial risks, including market risk, credit risk, operational risk, and liquidity risk.
2. Explore methods and strategies for identifying, measuring, and managing market risks.
3. Examine the principles and techniques of assessing and managing credit risk in financial transactions, including credit scoring, credit derivatives, and credit risk modeling.
4. Study the sources of operational risk within financial institutions and explore methods for mitigating and managing operational risk
5. Delve into quantitative methods and models used in financial risk management. 

Expected learning outcomes

By the end of the course, every learner should be able to:

1. Acquire knowledge of quantitative techniques for measuring and managing financial risks, including Value at Risk (VaR), Expected Shortfall (ES), credit scoring, and operational risk measurement models.
2. Demonstrate a comprehensive understanding of various types of financial risks, including market risk, credit risk, operational risk, and liquidity risk. 
3. Develop critical thinking skills to assess and evaluate risks, make informed decisions, and understand the trade-offs involved in risk management. 
4. Develop skills in integrating risk management into overall business strategy and decision-making, aligning risk appetite with organizational objectives. 
5. Understand the regulatory framework governing financial risk management, including the Basel Accords, and the role of regulatory bodies in ensuring sound risk management practices.

Further reading

Philippe Jorion, Financial Risk Manager Handbook", (2020), 7th edition Wiley

Philippe Jorion, Value at Risk: The New benchmark for managing financial Risk", 3rd edition, 2006, McGraw-Hill

Kevin Dowd, "Measuring market Risk", 2005, 2nd edition, Wiley

John C. Hull, "Options, Futures, and Other Derivatives"2017, 10th edition, Pearson

Tony Van Gestel, Bart Baesens, "credit Risk: Management: Basic concepts ", 2008, 1st edition, CRC Press

Harry H. Panjer,"Operational risk: Modeling Analystics",2002, 1st edition, Wiley

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