In addition, these risks are critical in evaluating the amount of investment and the rate of return that is required by investors on their investment with a company. Some of these risks are:
This refers to the poor earning reports, legal actions against company, management ineffectiveness, or potential bankruptcy related issues that might keep an investor from investing into the company's securities and stocks (Altamira Investment Services, 2003).
Credit risk refers to the possibility that the company will not be able to meet its obligations and pay off its debts as and when these become due. If this situation arises, this could have a drastically negative affect on the company's performance and its perception into the minds of potential investors. This might also result into a decline in stock prices and may ultimately lead to solvency problems for the company.
Exchange rate risk is one of the most critical risks for every investment decision. This refers to the situation where movements in exchange rates adversely affect the investments for an individual or the company. The exchange rates may move in favor of or against the investments for people. ...
However, if exchange rates show an increasing trend, an investor might not be willing to invest into a company's securities until the return from the investment in securities is more than the return from investments in foreign currency. In addition, for multinational companies or for those who try to diversify their portfolio by investing into foreign currencies, exchange risk might be a very critical element to take into account before making the investment.
1.1.4 Financial Risk
Finance risk is critical in the evaluation of investment proposals for investing in to a company's assets and securities. Liquidity risk refers to the situation when the company has no liquidity or cash to meet its obligations. This leads to insolvency and in the longer run, to bankruptcy. This can be calculated by analysing the financial statements for the company and by looking at its cash flow statements. The ratios like current ratio and quick ratio also provide information about the financial liquidity conditions of the company. These ratios should be calculated while making a decision about the financial conditions of a company where the potential investment is to be made.
1.1.5 Liquidity Risk
The liquidity risk refers to lack of marketability of an investment in securities or bonds. This means that the investment can not be converted into cash easily when required. This puts a serious limitation on the cash generating capability of a company that might lead to problems in both short and long terms.
1.1.6 Country and Market Risks
Some other risks that might be investigated before making an investment decision include country risk and market risks. These risks refer to adverse external environment conditions over which a company has lesser or no control. These risks
Investment risk refers to the probability and likelihood that the investments made by individuals as well as corporate investors do not provide the required returns that were calculated before the decision for the investment was made. There may be a number of investment risks that directly or indirectly affect investments…
Non-governmental Organizations are set up to offer services or goods to people with the aim of assisting them though capacity building. Financial management practices in NGO’s are different from the operations of For-Profit organizations. For instance, NGO’s source their funds through donations, sponsors or charitable sources.
In a merger both companies usually surrender their original stock and issue new stock for the new company of organization formed. (Sherman, 2010) Acquisition on the other hand, refers where a large company which is financially stable buyout a small company.
The conclusion from this review states that Morgan Stanley is a well known in the financial sector and is based in the United States but has offices all over the world. The biggest strength of the company is its brand image and a large base of employees. The company also has experience of many years in the financial sector.
Adaptability to certain various situations can help enhance the future employability. This adaptability comes from the knowledge. When an individual has the required knowledge about various things he can adapt very easily. This is because he is ready and aware of the upcoming challenges that he would have to face.
loan or credit in an economy. It is also recognised as a situation wherein individuals face difficulty in obtaining loans from banks. It is identified as an economic condition wherein certain difficulties are faced in obtaining loans along with investment capital by the financial institutions.
MCorp conducted a survey with 67 financial services firms of various sizes, across multiple lines of business, to determine the top branding and marketing priorities for 2005. These priorities depict what customers want and what is important to their financial success and how marketing affects the financial services industry.
A few important issues that a Manager should consider before planning for developments are Financial Issues, Marketing Function, and Human Resources. These issues are very much important, whether one is starting a new Business or expanding a well-running business, these issues are very much important.
The main objective of the financial management is to provide funds for the business. This is the backbone of the business because no firm or company can run without funds. There are many options for availing funds from different quarters. Although the
Increasing the efficiency of existing processes and / or enabling entirely new processes are sure ways of transforming a business (Laudon & Laudon 2010). This can be achieved by integrating computer systems with business processes and the objectives of a
According to the author of the text, sStrategic planning, today often requires collaboration with other firms while carefully observing other competitors. It is also stressed that in order to achieve competitive advantage in the market share an organization must therefore first build a strong relationship within itself.
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