Investment risks are the likelihood of unforeseen financial losses. Electricity losses in electrical networks Risks are distinguished by the level of losses

As follows from the previous presentation, the central place in the assessment of entrepreneurial risk is occupied by the analysis and forecasting of possible losses of resources in the implementation of entrepreneurial activity.

Let us recall once again that we do not mean the consumption of resources, objectively determined by the nature and scale of entrepreneurial actions, but random, unforeseen, but potentially possible losses arising from the deviation of the real course of entrepreneurship from the intended scenario.

To assess the likelihood of certain losses caused by the development of events according to an unforeseen option, one should first of all know all types of losses associated with entrepreneurship, and be able to calculate them in advance or measure them as probable predicted values. At the same time, it is natural to want to evaluate each of the types of losses in quantitative terms and be able to bring them together, which, unfortunately, is not always possible to do.

Speaking about calculating probable losses in the process of forecasting them, one must keep in mind one important circumstance. A random development of events that affects the course and results of entrepreneurship can lead not only to losses in the form of increased resource costs and a decrease in the final result. One and the same random event can cause an increase in the costs of one type of resources and a decrease in the costs of another type, i.e. along with the increased costs of some resources, savings in others can be observed.

So, if a random event has a double effect on the final results of entrepreneurship, has unfavorable and favorable consequences, when assessing the risk, both must be taken into account equally. In other words, when determining the total possible losses, the accompanying gain should be subtracted from the calculated losses.

Losses that can be in entrepreneurial activity should be divided into material, labor, financial, time losses, and special types of losses.

Material losses are manifested in additional costs not foreseen by the entrepreneurial project or direct losses of equipment, property, products, raw materials, energy, etc. In relation to each individual of the listed types of losses, their own units of measurement are applicable. The most natural way to measure is the amount of a given type of material resources, i.e. in physical units of weight, volume, area, etc. However, it is not possible to bring together the losses measured in different units and express them in one quantity. You cannot add kilograms and meters. Therefore, it is almost inevitable to add kilograms and meters. Therefore, it is almost inevitable to calculate losses in value terms, in monetary units. For this, losses in the physical dimension are converted into a value dimension by multiplying by the price per unit of the corresponding material resource.

For a sufficiently significant amount of material resources, the cost of which is known in advance, the losses can be immediately estimated in monetary terms. Having an estimate of the probable losses for each of the individual types of material resources in value terms, it is possible to bring them together, while observing the rules of action with random variables and their probabilities.

Labor losses represent losses of working time caused by accidental, unforeseen circumstances. In direct measure, labor losses are expressed in man-hours, man-days, or simply hours of working time. The translation of labor losses into value, monetary expression is carried out by multiplying the labor hours by the cost (price) of one hour.

Financial losses are direct monetary damage associated with unforeseen payments, payment of fines, payment of additional taxes, loss Money and securities. In addition, financial losses may occur if money is not received or received from the provided sources, if debts are not returned, if the buyer does not pay for the products supplied to him, and revenue decreases due to a decrease in prices for products and services sold.

Special types of monetary damage are associated with inflation, changes in the exchange rate of the hryvnia, in addition to the legalized withdrawal of funds from enterprises to the state (republican, local) budget.

Along with the final, irrecoverable, there may be temporary financial losses caused by the freezing of accounts, not timely disbursement of funds, and delayed payment of debts.

Waste of time occurs when the business process is slower than planned. A direct assessment of such losses is carried out in hours, days, weeks, months lagging in the cost measurement. It is necessary to establish to what loss of income, profits from entrepreneurship can lead to random loss of time.

Special types of losses are manifested in the form of damage to the health and life of people, environment, the prestige of the entrepreneur, as well as due to other adverse social and moral and psychological consequences. Most often, special types of losses are extremely difficult to quantify, especially in terms of value.

Naturally, for each of the types of losses, the initial assessment of the possibility of their occurrence and the magnitude should be made for certain time covering the month, year, term of the entrepreneurship.

When conducting a comprehensive analysis of probable losses for risk assessment, it is important not only to identify all sources of risk, but also to identify which sources prevail.

Analyzing the types of losses listed above, it is necessary to divide the probable losses in a quantitative assessment of the level of risk. If, among the considered losses, one type stands out, which, either in magnitude or in the likelihood of occurrence, obviously suppresses the rest, then when quantitatively assessing the level of risk, only this type of loss can be taken into account.

Suppose that, as a result of the preliminary analysis, it was possible to “filter out” the most significant types of losses in terms of magnitude and likelihood of occurrence. Further, it is necessary to isolate the random components of losses and separate them from the systematically recurring ones.

In principle, it is necessary to take into account only random losses that are not amenable to direct calculation, direct forecasting and therefore unaccounted for in entrepreneurial project... If losses can be foreseen in advance, then they should not be considered as losses, but as inevitable costs and included in the calculation.

So, the foreseeable movement of prices, taxes, their change in the course of economic activity, the entrepreneur must take into account in the business plan.

Only due to the imperfection of the methods used for calculating entrepreneurial activity or the insufficiently deep study by the entrepreneur of the business plan, systematic errors can be considered as losses in the sense that they can change the expected result for the worse.

Therefore, before assessing the risk due to the action of purely random factors, it is highly desirable to separate the systematic component of the loss from the random ones. This is also necessary from the standpoint of mathematical correctness, since the procedures for operations with random values differ significantly from the procedures for operations with deterministic values.

Let us now consider in somewhat more detail the structure of losses depending on the type of entrepreneurial activity, i.e. industrial commercial and financial entrepreneurship. At the same time, we will highlight the main manifestations. Knowledge of the risk factors allows early action to mitigate their effects.

Before proceeding to the analysis of the manifestations of accidental losses in industrial, commercial, financial entrepreneurship, let us point out some specific sources of losses and the factors influencing them.

These include losses from the impact of unforeseen political factors. Such losses create political risk. It manifests itself in the form of an unexpected change in the conditions of economic activity caused by political considerations and events, creating an unfavorable background for the entrepreneur and thereby capable of leading to increased resource costs and loss of profit.

Typical sources of such risk are an increase in tax rates, the introduction of compulsory deductions, changes in contractual conditions, transformation of forms and relations of ownership, alienation of property and funds for political reasons. The amount of possible losses and the degree of risk determined by them in this case is very difficult to foresee.

Losses caused by natural disasters, as well as theft and racketeering are quite close in terms of unpredictability.

Possible losses caused by imperfect methodology and incompetence of persons who form a business plan and calculate profit and income are very specific. If, as a result of the action of these factors, the values of the expected values of profit and income from the entrepreneurial project are overestimated, and the actual results obtained are lower, then the difference is involuntarily perceived as a loss.

Although in reality, if the nominal values of profit (income) were determined correctly, then the threat of such conditional losses might not be taken into account. But when the estimated profit is overestimated, then its "shortage" will certainly be considered damage, and there is a risk of such losses.

A special place is occupied by the entrepreneur's losses due to the dishonesty or insolvency of partners. Unfortunately, the risk of being deceived in the transaction or facing the insolvency of the debtor or the irrecoverability of the debt is quite real.

Now let's consider more trivial situations of threat of loss and risk in relation to the specified types of entrepreneurship. We emphasize again: it is almost impossible to completely avoid risk, but knowing what creates losses, an entrepreneur is able to reduce their threat, reducing the effect of an unfavorable factor.

So, let us characterize the losses, the potential of which gives rise to entrepreneurial risk.

Investment risks are

Hello dear readers. There are situations when you want to and pricks. This is about almost the whole life of Marat, my classmate. As long as I know him, he always doubts everything, although he really wants to do it.

Now he has free funds. Wants to invest them. But bam! The eternal worm of doubt is gnawing.

I help him as much as I can. The other day I talked about investment risks - what they are and how to assess them correctly. For you, friends, I also prepared a detailed material on the topic.

Investment risks

Investment activity in all forms and types is associated with risk.
Investment risk is the likelihood of unforeseen financial losses in a situation of uncertain investment conditions.

Investment risks can be classified according to different criteria. By areas of manifestation, investment risks are:

Technical and technological
Economic
Political
Social
Environmental
Legislative and legal

Technical and technological risks are associated with uncertainty factors that affect the technical and technological component of activities during the implementation of the project, such as: reliability of equipment, predictability of production processes and technologies, their complexity, level of automation, rates of modernization of equipment and technologies, etc.

Economic risk is associated with uncertainty factors that affect the economic component of investment activities in the state and on the activities of the economic entity during the implementation investment project within the framework of the target setting for achieving general economic equilibrium of the system and accelerating the growth rate of its gross national product by producing competitive products in the world market, choosing a rational combination of forms and spheres of production, implementing government measures for countercyclical regulation of the economy, etc.

Economic risk includes the following uncertainties: the state of the economy; economic budgetary, financial, investment and tax policy pursued by the state; market and investment environment; cyclical development of the economy and phases of the economic cycle; government regulation economics; dependence of the national economy; possible non-fulfillment by the state of its obligations (partial or complete expropriation of private capital, various kinds of defaults, termination of contracts and other financial shocks), etc.

Political risks are associated with the following uncertainties that affect the political component in the implementation of investment activities:

elections at various levels;
changes in the political situation;
changes in government policy;
political pressure;
administrative restrictions on investment activities;
foreign policy pressure on the state;
freedom of speech;
separatism;
deterioration of relations between states, which may have a negative impact on activities joint ventures etc.

Social risks are associated with uncertainty factors that affect the social component of investment activities, such as: social tension; strikes; implementation of social programs.

The social component is due to the desire of individuals to create social connections, provide assistance to each other, adhere to the assumed mutual obligations; the role they play in society; service relations; moral and material incentives; existing and possible conflicts and traditions, etc.

The limiting case of social risk is personal risk, which is associated with the impossibility of accurately predicting the behavior of individuals in the process of their activities and is due to the human factor.

Environmental risks are associated with the following uncertainty factors affecting the state of the environment in the state, region and affecting the activities of the invested objects: environmental pollution, radiation conditions, environmental disasters, environmental programs and environmental movements such as "Green peace", etc.

Environmental risks are divided into the following types:

technogenic risks related to emergencies associated with the following factors: man-made disasters at enterprises that cause contamination of the environment with radioactive, poisonous and other harmful substances;
natural and climatic risks are associated with the following uncertainty factors that affect the implementation of the investment project: the geographical location of the facility; natural disasters (floods, earthquakes, storms, etc.);
climatic disasters; the specificity of climatic conditions (arid, continental, mountain, sea, etc. climate); availability of minerals, forest and water resources, etc .;
social and domestic risks associated with the following uncertainty factors that affect the implementation of the investment project: morbidity of the population and animals with infectious diseases; massive spread of plant pests; anonymous calls about the mining of various objects, etc.

Legislative and legal risks are associated with the following uncertainty factors that affect the implementation of the investment project: changes in the current legislation; inconsistency, incompleteness, incompleteness, inadequacy of the legal framework; legislative guarantees; lack of independence of the judiciary and arbitration; incompetence or lobbying for the interests of certain groups of persons when adopting legislative acts; inadequacy of the taxation system existing in the state, etc.

According to the forms of manifestation, investment risks are divided into risks of real and financial investment.

Real investment risks that may be associated with the following factors:

interruptions in the supply of materials and equipment;
rising prices for investment goods;
selection of an unqualified or unscrupulous contractor and other factors that delay the commissioning of the facility or reduce income during operation.

Financial investment risks associated with the following factors: ill-considered choice of financial instruments; unforeseen changes in investment conditions, etc.

According to the sources of occurrence, investment risks are divided into systematic and non-systematic.

Systematic (market, nondiversifiable) risk arises for all participants in investment activities and all forms of investment.

It is determined by the change in the stages of the economic cycle, the level of effective demand, changes in tax legislation and other factors that the investor cannot influence when choosing an investment object.

Non-systematic (specific, diversified) risk that is characteristic of a specific investment object or for the activities of a specific investor. It can be related to the competencies of the personnel of the management of the enterprise; increased competition in this market segment; irrational capital structure, etc.

Attention!

Unsystematic risk can be prevented by diversifying projects, choosing an optimal investment portfolio, or effective management project.

Investment activity is characterized by a number of investment risks, the classification of which by type can be as follows.

Inflation risk - the likelihood of losses that an economic entity may incur as a result of the depreciation of the real value of investments, loss of real initial value by assets (in the form of investments) while maintaining or increasing their nominal value, as well as the depreciation of the expected income and profit of an economic entity from investments in conditions uncontrolled outstripping of inflation growth rates over investment income growth rates.

Deflationary risk - the likelihood of losses that a subject to the economy may incur as a result of a decrease in the money supply in circulation due to the withdrawal of a part of excess funds, incl. by raising taxes, discount interest rates, reducing budget expenditures, savings growth, etc.

Market risk - the likelihood of changes in the value of assets as a result of fluctuations in interest rates, exchange rates, stock and bond prices, prices of goods that are the object of investment.

The types of market risk are, in particular, foreign exchange and interest rate risk.

Operational investment risk - the probability of investment losses due to technical errors during operations; due to intentional and unintentional actions of personnel; emergency situations; malfunctions of information systems, hardware and computer technology; security breaches, etc.

Functional investment risk - the probability of investment losses due to mistakes made in the formation and management of the investment portfolio of financial instruments.

Selective investment risk - the probability of the wrong choice of the investment object in comparison with other options.

Liquidity risk - the likelihood of losses caused by the inability to release investment funds in the required amount without loss in a fairly short period of time due to the state of the market environment.

Also, liquidity risk is understood as the likelihood of a shortage of funds to meet obligations to counterparties.

Credit investment risk manifests itself if investments are made using borrowed funds and represents the likelihood of a change in the value of assets or loss of assets of their original quality as a result of the inability of the borrower-investor to fulfill its contractual obligations, both in general and for individual positions in accordance with the terms of the loan. contract.

Country risk - the likelihood of losses in connection with investments in facilities under the jurisdiction of a country with an unstable social and economic situation.

The risk of lost profit is the likelihood of indirect (collateral) financial damage (non-receipt or loss of profit) as a result of non-implementation of any measure, such as insurance.

It should be noted that this classification is somewhat arbitrary, since it is quite difficult to draw a clear line between certain types of investment risks.

A number of investment risks are interconnected (correlated with each other), changes in one of them cause changes in the other, which affects the results of investment activities.

Source: http: //site/www.risk24.ru/invriski.htm

Concept, types, R&D insurance

Investment risks are an issue that needs to be paid, in my opinion, special attention before starting investment activities.

Let's consider what is the essence of risks, what are their types and how to make a risk assessment before investing capital accumulated by long work.

First of all, the article will be written in scientific language, but later I will give an interpretation of my vision of this situation.

The essence

Investment risk is the risk of depreciation of the invested capital (loss of initial value) as a result of ineffective actions of the company's management or the state.

A smart manager, when compiling an investment portfolio, should first assess the investment risks and only then look at the potential return.

It is also true that high potential return carries investment risk.

Classification

Systemic (aka market, nondiversifiable) risk is associated with external factors affecting the market as a whole. This is an integral part of any investment activity.

These include currency, inflationary, political risks, and the risk of changes in interest rates. Such a risk can be influenced by a change in the stages of the economic cycle, changes in tax legislation, and the level of effective demand.

Attention!

Non-market (non-system) risk implies industry, business and credit risks. Such risks are inherent either in one investment instrument, or in the activity of a particular investor.

They can be minimal by compiling an investment portfolio that is optimal in terms of the set (diversifying risks), changing the investment strategy, and rationally managing the object.

Such a classification affects only the largest groups of risks, now let us consider each of the types in more detail.

Inflationary - the risk caused by rising inflation - has a negative impact, since it reduces real profits.

The real value of assets may decrease, despite the preservation or growth of its nominal value, the projected return on investments may not be achieved due to the uncontrolled growth of inflation rates, which outstrip investment returns.

This risk is closely related to the risk of changes in the interest rate (interest rate risk).

Interest rate risk - risks arising from the possibility of changes in the interest rate set by the central bank.

A decrease in the interest rate leads to a decrease in the cost of loans for businesses, which in turn leads to an increase in the profits of enterprises and, in general, has a positive effect on the stock market.

Currency - the risk associated with possible changes in the exchange rate of one currency in relation to another, associated primarily with the economic and political situation in the country.

Political risks - the risk of negative impact of political processes on economic ones. Such risks should be understood as the possibility of a change of government, war, revolution, etc.

These risks are primarily market risks and cannot be controlled by the investor. Non-systemic investment risks include:

Industry-specific - the risk to which all joint-stock companies in this industry are exposed.

Business - the risk associated with irrational management of the joint-stock company by the company's management and low production efficiency.

Investment credit - arises in cases when investments are made at the expense of borrowed funds and is expressed in the potential risk of the investor not to return credit funds in full due to a change in the value of his assets in an unpredictable direction, insufficient profitability or deterioration in the quality of these assets themselves.

Country - the possibility of losses due to investment in objects under the jurisdiction of a country that does not have a strong economic and social position.

The risk of lost profits is the possibility of getting indirect losses (incurring losses or receiving less profit) due to failure to fulfill a certain measure.

Liquidity risk - the ability to receive losses due to the inability to quickly transfer assets into cash. Sometimes it is considered as a possibility of lack of funds to pay obligations to counterparties.

Selective investment - the probability of choosing a less profitable instrument in comparison with others.

Functional investment - the probability of receiving losses as a result of improper formation of the investment portfolio and its management.

Operational investment - the possibility of obtaining investment losses due to technical errors during operations, software failures, etc.

Minimizing risks

The above has been described different types risks, and now we have to understand how to assess investment risk, how to analyze different financial instruments and find the most optimal risk-return ratio.

I will make a reservation right away that now we will move away from theory and come close to the practice of investing (mostly from the side of a private investor or entrepreneur).

Let's take an example with stock market... Risks here increase, firstly, depending on the choice of a financial instrument. Naturally, the risk of capital loss is higher when trading futures contracts than when trading bonds.

But let's take, for example, the most common financial asset (the difference between assets and liabilities) - stocks. In this case, we get that:

it is possible to minimize industry risk when compiling a portfolio of shares of companies in several sectors of the economy
minimize country risk - by investing in foreign assets
business - through preliminary fundamental analysis and selection of stocks with the highest growth prospects
credit - by reducing or decreasing credit funds for investment
risk of lost profit - due to setting stop-losses and take-profits, hedging (insuring) shares with futures contracts
liquidity risk - due to the choice of the most liquid instruments (for example, shares of Gazprom, Sberbank)
fundamental - through fundamental analysis plus diversification
operational - choosing the highest quality broker

Naturally, non-systemic risks are also not easy to eliminate, especially in Russia, but in general, with a competent approach, they can be significantly reduced.

The main methods for reducing investment risks, listed above, will not only save, but also significantly increase capital.

Stop Loss

I would like to say a little more about stop-losses. When you are planning to start making money on the exchange, do not neglect such a rule as placing stop losses, especially when trading with leverage.

Attention!

What is it for? In order to immediately minimize losses in case of untimely entry into the market.

Think, for example, of the losses that investors suffered when they bought stocks at their peak in early 2008. But the market has not returned to its previous level even now.

Likewise, when trading leveraged instruments, in the event of an unfavorable coincidence, your deposit can get an even more serious drawdown if no stop loss has been set.

Therefore, do not hope that the market will turn around and go in your direction - go for it.

Source: http: //site/finansiko.ru/investicionnye-riski/

Dealing with the company's investment risks

As with any other type, investment risk is characterized by a close relationship of potential threats, probability and uncertainty.

Investments in fixed assets and other forms of investment activity are accompanied by numerous risks.

Consequently, investment risk should have a set of special features, the presence of which indicates its presence as a control object. Among these features, we can highlight the following.

The likelihood or possibility of an adverse event occurring as a result of investment activities.
Uncertainty of the occurrence of an event and its consequences.
The fact of the actual investment of funds, which is the reason for the occurrence or non-occurrence of a risk event.
Consequences are considered in the form of loss of expected profit or other beneficial effects from realized investments.

In the future, we will understand investment risk as the possibility of an unfavorable event as a result of the company's management making a decision to invest funds.

The composition of investment risks in almost every case is supplemented by the risks of bank borrowing. The innovativeness of some investments also causes additional risks.

Grade

Undesirable consequences arising from the occurrence of risky events in investment activities may include:

in the loss or failure to achieve the planned profit;
in reducing the efficiency of the business line in which investments were made;
in the undercapitalization of the product of the investment project;
in untimely commissioning of the facility;
in increasing the terms of bringing the investment object to full capacity;
in a fall in the market value and (or) liquidity of a financial instrument, etc.

As you know, investments are divided into two large groups: real (direct) investments, which are often called capital investments, and financial (portfolio) investments.

These groups determine investment risks, the essence and classification of which are expressed through the areas of dynamic (speculative) and static (net) risks.

The first group is caused by decision-making by the company's management and can lead to a “coup” in chances, i.e. incur not only losses, but also the potential for additional benefits.

The second group provokes losses for business, personnel and society, for example, due to technological failures, natural disasters, environmental disasters, damage to the health of employees, etc.

Variety of species

Investment activity, in contrast to operating, has a significant variety of risks, since the level of unpredictability is higher, and it is more difficult to achieve certainty of future events.

For better identification of possible threats, risk factors, systematization of sources of adverse events, it is important at each enterprise to carry out work on its own risk classification.

The classified types of investment risks make it possible not only to build an effective risk management system, but also to answer a number of key questions of the company's development.

Business owners, general director at fateful moments, they ask questions related to the identified, identified and assessed risks:

Will the risks of loss exceed the benefits of opening a new business line?
Shouldn't the risk be shared by attracting new partners to the project?
Is it worth taking on investments in the face of potential threats and dangers?
How do we subjectively perceive the risk of capital losses in this case?
Can we accept the assessed risk?
Are we satisfied with the measures to minimize the risk?

All these questions are in one way or another related to risk classes. Moreover, it matters how the risk is assigned to a certain type with its inherent features and qualities.

If identification, assessment and preparation of a decision are carried out collectively, as a rule, the level of risk is allowed at higher values. This is evidenced by the statistics of decisions made.

And this circumstance, of course, is very useful for investment. The classification of investment risks in tabular form is presented below.

Types of investment risks

The types of investment risks also differ according to the stages of the life cycle of an investment project.

Attention!

The most common classification is for a capital construction project, divided into the stages of preparation, the actual construction and operation of the commissioned facility.

A similar structured classification of the main risk factors, together with their causes, is shown in the diagram below.

Among the related classifications of investment risks, one more division of them into commercial and simple ones stands out. Commercial risks are often viewed as the same as speculative or dynamic risks.

This includes risks directly related to investment and general business activities. The basis of commercial risks is formed by a variety of threats identified in connection with investments in fixed assets and financial instruments.

Simple risks are sometimes compared to pure risks, these include:

the likelihood of the manifestation of elemental forces of nature;
the threat of damage to the environment due to the implementation of investment actions;
risks accompanying the transportation of goods;
the possibility of damage to property by the actions of third parties;
political risks.

Methods for assessing investment risks, first of all, divide this analytical procedure into qualitative and quantitative assessment.

Each of these approaches has its own implementation principles, which make it possible to fully characterize the analyzed risk and prepare for making a decision on measures to respond to probable threats.

Qualitative assessment is guided by two rules, taking into account the following. For each participant in an investment project, the probable damage cannot exceed its financial capabilities.

Possible risk losses for each case are independent.

Methods of quantitative assessment involve the analysis of investment risks and the accompanying search for the values of the following parameters:

losses (damage) or additional profit (income) from the investment process, taking into account the risk event;
the likelihood of the impact of a risk event on the results of implemented investments within certain limits for each hazard or threat;
the ratio of potential losses (damage) and costs for the implementation of measures to reduce the level of the corresponding risk;
the qualitative degree of threats: catastrophic, high, medium, low, zero;
the level of acceptability compared to the target threshold according to the risk policy.

A quantitative assessment of investment risks for finding the above indicators is carried out using special methods, among which we will single out five main groups.

Analytical (probabilistic) methods.
Statistical methods of assessment.
Cost Feasibility Analysis Methods.
Methodology for expert assessments.
Methods of using analogs.

Assessment methods based on probabilistic and statistical methods are discussed in detail in the article on risk assessment methods.

The analysis of the feasibility of costs serves to search for risk factors in the areas of formation of investment costs and assess their impact on financial stability companies.

There are four main sources in the methodology:

initial underestimation of the value of capital investment objects;
forced change of design boundaries;
the difference in the actual performance of investment objects in comparison with the planned;
increase in the cost of the entire project in the course of work.

Methods of expert assessments are widely used in the West. They make it possible to draw conclusions in the absence of statistical data, do not require complex and expensive tools, and are quite fast and easy to execute.

However good independent experts hard to find, hard to avoid bias.

If, in the investment practice, information is collected on the implementation of similar projects, R&D methods for assessing risks are suitable methods of using analogs.

This methodology integrates classification schemes that allow, by analogy, to quickly and efficiently identify risks.

Basic regulation methods

As in the general concept of risk management, investment risk management is based on "three pillars" of successive events: to identify, assess, reduce.

After the stage of identifying and identifying risks, an assessment and analytical stage follows.

On their basis, a program is developed to minimize the likely negative consequences, regulations are used: policies, procedures and rules.

At the last stages, investment risk management ends with the implementation of the adopted program with accompanying control and analysis of the results achieved.

Attention!

The investment section of risk management includes, in addition to traditional components, also special aspects of regulation.

Among them, a special place is occupied by the legal and insurance areas. Risk mitigation methods, in my opinion, consist of five main groups.

Avoidance (evasion, refusal).
Transfer (including insurance).
Localization.
Distribution (including diversification in its various forms).
Compensation.

This structure of threat mitigation methods is described in an article devoted to methodological issues of risk management.

In the literature, there is a slightly different grouping of methods, which also has its own well-founded logic of consolidation. There are three main groups: refusal, transfer and acceptance.

In this case, minimization, compensation and localization of risks are part of their acceptance. An organizational model for grouping methods in this way is presented below.

It is worth noting that many methods overlap with each other and have internal rationalization mechanisms, which are important in modern economic conditions, forcing to economize on literally everything.

Take self-insurance as a way to compensate for risks through the formation of special funds. The fact is that funding is possible only at the expense of net profit under the current tax legislation.

The problem of additional taxes, which must first be paid and then formed a fund, is solved by many companies in a roundabout way through an external insurance company.

And this is another method, which is not easy to attribute to a purely insurance method.

Source: http: //site/projectimo.ru/upravlenie-riskami/investicionnye-riski.html

Investment risks

Investment risks are the likelihood of full or partial loss of invested capital, non-receipt or shortfall of planned income, both in real cash equivalent and through depreciation of the invested funds.

In general, all human life in one way or another is associated with risks, and absolutely any person daily risks something to one degree or another.

There is nothing terrible in this, it is an objective reality that simply requires adequate perception, understanding and caution.

Their risks accompany literally any area of human life, be it personal life, health, labor activity, social sphere, financial sphere, etc.

So in the field of investments there is a group of risks that inevitably accompany any investment of capital.

Traditionally, investment risks are one of the factors in the formation of passive income.

It is impossible to imagine any activity involving the investment of capital and the receipt of income, in which the risk factor would be completely absent.

We can say that the income that a private investor receives is a kind of payment for risk.

Any investment of money (even “under the pillow”) is always associated with risks! Any investment always involves investment risks! There is no absolutely risk-free investment in nature, just the degree of this risk can be different.

Thus, investing risks are completely normal and should not be feared. But at the same time, a private investor must adequately assess their risks and manage them competently.

Risk management is, in my opinion, the primary task for any investor, on the solution of which the safety and growth of his capital fully depends.

Views

Here I must say that there are many different classifications. I want to highlight those types of investment risks that are most relevant for a private investor, which he must necessarily analyze and manage.

Risks of direct financial losses. This is perhaps the most terrible group of risks for a private investor, since they imply the possibility of partially or completely losing the invested capital.

For example, due to the fact that the currency of its capital will significantly devalue and depreciate: in fact, the capital will be preserved, but its real value will be significantly lower.

Risks of decreased profitability. This group of investment risks is not as terrible as the first two, but it also has its own significance.

Its essence lies in the fact that an investor can receive from his investments completely different profit than he predicted, or even not receive it at all.

In some cases, this may not be comparable to the level of investment risk, which makes the investment simply impractical.

For example, investments in shares of newly created enterprises bring the investor income at the level of bank deposits.

But at the same time, they are much more exposed to the risk of direct financial losses than deposits, which imply both a much higher degree of reliability and the effect of state guarantees.

Thus, it makes no sense for an investor to keep capital in stocks when he can receive the same return with much lower risks by simply placing them on a deposit.

Profit loss risks. This, I think, is the least significant group of risks, since it does not imply loss of investments, but only lost profits, which is not so scary, but experienced investors always pay special attention to it.

For them, lost profits are tantamount to financial losses.

How to reduce investment risks?

Of course, the issue of reducing investment risks is worthy of separate detailed consideration from various angles. Therefore, today, speaking about how to reduce investment risks, I will only briefly dwell on the main points.

Adequate assessment of the level of risk. First of all, an investor must be able to adequately assess how risky certain investments will turn out to be.

In no case should you hope for a miracle and invest capital according to the “what if it blows” principle. Here it is even better to overestimate and reinsure than to underestimate.

Investment portfolio formation. If the entire capital of a private investor is invested in one single asset, the investment risks in this case will be excessively high, no matter how highly reliable this asset may seem.

Therefore, it is necessary to compile an investment portfolio, distributing funds to different assets and different sources of passive income.

Diversification of risks. Continuing the topic of forming an investment portfolio, it should be added that the deeper and wider the diversification of its constituent financial instruments, the more reliably the investor's capital is protected as a whole.

Diversification of risks involves investing capital in different assets, different financial institutions, in different currencies, for different periods, with different withdrawal methods, etc.

Portfolio rebalancing. One of the most effective investment risk management tools is the so-called rebalancing of the investment portfolio.

That is, an investor must constantly monitor his portfolio and, if necessary, transfer capital within it from one instrument to another in order not only to reduce investment risks, but also to maximize profits.

Timely withdrawal of funds. As a rule, each investment of capital implies its own investment period, which is calculated based on the analysis of a specific financial instrument.

At the end of the period, or even earlier, if there are objective reasons for this, the investor must withdraw his capital.

In other words, one should not be greedy, trying to “snatch” as much as possible, but act according to the planned investment plan.

Source: http: //site/fingeniy.com/investicionnye-riski/

Risk management

There are many investment opportunities around us now. But with all this abundance of proposals for your investments, each investor should consider the possibility of losing their investments and be able to correctly assess investment risks.

Attention!

Investment risk is an economic category that clearly demonstrates the efficiency of a potential investment object, as well as its financial condition, on the way to achieving the goals set by the investor, which are accompanied by various factors, controlled and uncontrolled.

Investment risk is the likelihood of an unfavorable investment result. This can be a loss of capital, and a loss of the pace of development of the organization, and the cession of market positions to competitors.

Classification

Investment risks are of several types. Systematic investment risk, or in other words, the risk associated with the state of affairs in the global economy.

When assessing this risk, it is worth considering fluctuations in interest rates, inflation and the risk of falling financial assets.

Unsystematic investment risk. This type of investment risk is directly related to the financial condition of a particular investment object and reflects the risk in a particular economic sector, it takes into account the risk of business relations between partners, as well as credit risk.

Non-systematic risks are understood as problems with payment from suppliers, low or lack of solvency among consumers, development of competition in the market, bankruptcy of partners, etc.

Financial investment risk - associated with financial losses due to bankruptcy, or unprofitability of the investment object.

Investment liquidity risk is how quickly an investor can realize, sell an object of his investment under unfavorable conditions.

Industry investment risk - as a rule, there are ups and downs in any sector of the economy. This risk is associated with changing cases in a particular industry.

Investment risk is the degree to which it is realistic to obtain a specific result from your investment.

But the level of this risk is constantly changing as the global economy changes and develops.

Types of risks:

technological risks - the reliability of production equipment, as well as the ability to predict production processes and technologies, the ability to assess the degree of deterioration and the need to modernize equipment
environmental risks - related to ecology and the environment
economic risks - risk of change economic course in a particular country, the degree of development of certain sectors of the economy
political risks - a change in the political situation of a particular country, a change in political course, etc.
social risks - social tension in society, strikes, etc.
legal risks - changes in legislation, assessment of the level of objectivity, completeness, flexibility of current legislative acts

Management of risks

One of the main methods and ways of managing investment risks in the implementation of investment activities is the creation or organization of a certain entity that performs and performs the role and functions of intermediaries between the investor and his assets. Such intermediaries are all kinds of brokerage companies, investment funds, etc.

In this case, the competence and professionalism of such an intermediary comes to the fore.

Investment risk management, in such a situation, is possible by implementing the following measures:

Assessment of the quality of the intermediary's activity, the assessment is made by analyzing the technologies used by the intermediary, their operational and informational parts.

Also, all information about the activities of the intermediary, about his business reputation, etc. is collected.

Assessment of the functioning of the intermediary. It is possible to carry out such an assessment only having reliable and sufficient statistical, quantitative indicators of the activity of a particular intermediary.

If such data are available, there are two ways of assessing

absolute estimate (this is a comparison real indicators intermediary with a possible benchmark or with "ideal" indicators)
relative assessment (comparison of the performance of a particular intermediary with the performance of competitors)

One-time use of the services of several intermediaries. Gaining control over the activities of the intermediary. Control can be both financial and operational in nature.

Attention!

This investment risk management method is suitable for large investors. Control of this kind allows you to know, and therefore to solve all internal and external risks directly related to the activities of the intermediary.

Insurance and investment hedging. Refusal of an intermediary. Investor's direct participation in the market.

This method of managing investment risks reduces the costs of paying for intermediary services, but it can cause a number of unplanned risks, for example, misuse of funds, etc.

Risk planning is a predictive estimate of the potential loss of resources. It is necessary to quantify the forecast values.

Risk losses can be :

 material;

 labor;

 financial;

 loss of time;

 other losses.

Knowing the probable losses of each type of resources when planning a development strategy, it is possible to estimate the total risk associated with the chosen strategy option.

If an element of the strategy has a double effect on the results of production and economic activities, i.e. leads to overspending and saving resources, then when assessing the total risk, both savings and overspending must be taken into account.

Material losses are additional costs of raw materials, materials, fuel, energy, equipment and other property not foreseen by the plan. The assessment of these losses is made both in natural and in value terms.

Labor losses - appear in unplanned expenditures of working time and can be expressed in physical and cost indicators (intra-company downtime of workers can be estimated in man-hours, as well as the amount of additional payments paid for downtime). In addition, it is necessary to estimate the volume of products that the enterprise did not release due to the interruption of production.

Financial losses - have direct monetary damage (fines, penalties, forfeits, non-return of accounts receivable, a decrease in sales volumes due to price reductions, shortfall in dividends on shares).

Depreciation of financial resources (depreciation and working capital due to inflation, freezing of accounts, lagging accounts).

Waste of time associated with the pace of implementation of the strategy, when the process of production and economic activity is carried out more slowly than it was envisaged in the plan.

Such losses are expressed:

▪ in the death of resources;

▪ in late arrival financial results(cash flows). They are valued using discounting.

Other losses are a special group of losses that is difficult to assess.

These are losses associated with damage to prestige, moral and psychological damage to the environment.

Prices are at the greatest risk in a market economy.

Changes in prices affect not only the change in the cost indicators of sales. Changes in prices in the market affect supply and demand, that is, a change in the volume of sales.

In conditions of inflation, dynamic demand and supply, changes in prices for products and input resources, predict the price even for short term very difficult.

When planning, it is necessary to take into account only accidental losses, which cannot be taken into account in advance in the planned strategy.

When analyzing losses, it is important to rank them, highlight the most significant, the most probable ones, in order to make a forecast based on the analysis, their manifestation in the planning period.

The most important tool in the analysis of losses is knowing the causes of their occurrence.

Depending on the causes of occurrence, there are risk groups :

When planning risk, it is necessary to distinguish between such concepts as resource costs, losses and losses. The economic activity of an enterprise is always associated with the cost of resources, while losses and losses occur under an unfavorable coincidence of circumstances, miscalculations in planning and represent additional costs in excess of the planned ones. If losses can be foreseen and foreseen in the plan, then they should be considered as unavoidable costs and included in the costs.

Therefore, risk planning is a predictive assessment of possible losses of resources in the event of unfavorable circumstances and deviations from the planned strategy, as well as lost profits in the implementation of business operations. In this case, it is necessary to quantify the predicted values of losses.

Loss associated with risk, can be:

material,
labor,
financial,
time,
others.

These types of losses can occur in all spheres of economic activity: production, financial, commercial, etc. Knowing the probable losses of each separate type of resources when planning the development strategy of the enterprise, it is possible to assess the total risk associated with the chosen strategy option. It should be borne in mind that if one or another element of the strategy has a double effect on the results of production and economic activities, that is, leads to overspending and saving resources, then when assessing the total risk, both savings and overspending must be taken into account.

Material losses represent additional costs of raw materials, materials, fuel, energy, equipment and other property not foreseen by the plan. Evaluation of these losses when planning a strategy is carried out both in physical and in value terms.

Labor losses are manifested in unplanned expenditures of working time and can be expressed in physical and cost indicators. For example, unforeseen inter-shift downtime of workers can be estimated in man-hours, as well as the amount of additional payments paid to workers during downtime. In addition, it is necessary to assess the volume of products that the enterprise did not release due to the interruption of production.

Financial losses can take the form of direct monetary damage caused to the enterprise by unforeseen circumstances, for example, fines, penalties, penalties, non-repayment of receivables, a decrease in sales volumes due to a decrease in prices for the company's products, non-receipt of dividends on shares owned by the enterprise, etc.

Another group of financial losses includes impairment of financial resources, such as depreciation and working capital due to inflation, delays in payments, freezing of accounts, etc.

Waste of time associated with the pace of implementation of the strategy, when the process of production and economic activity is carried out more slowly than it was envisaged in the plan. Such losses are expressed, first, in the death of resources; secondly, the delay in the receipt of financial results (cash flows). They are valued using discounting.

A special group of losses, which in practice is rather difficult to assess, are losses associated with damage to the prestige of an enterprise, moral and psychological damage to its employees, damage to the environment, etc.

It is impossible to completely avoid risk in economic activity, but knowing where and under what circumstances it can arise, managerial personnel can prevent it, reduce the threat of losses, reducing the effect of unfavorable factors. Therefore, it is important to know where this or that loss may occur.

In the field of production, losses can be expressed in a decrease in the planned volumes of production and sales of products due to a decrease in labor productivity, equipment downtime, loss of working time, poor product quality, and other reasons. Another source of losses is overconsumption of materials, raw materials, fuel, energy and other material factors of production due to disruptions in the production process. Large potential losses lie in a possible decrease in prices at which it is planned to sell products, an increase in costs due to an increase in transportation costs, trade margins, overheads and other factors. A certain danger is posed by taxes and payments to extra-budgetary funds, if their rates increase in the process of implementing the plan.

It should be emphasized that among all the factors considered, prices are subject to the greatest risk in a market economy. Therefore, planning the price of products and services sold, as a rule, forms a significant portion of the economic risk. This risk is superimposed on the risk in determining the price of the resources consumed in the production process, which causes an even greater risk. Experts argue that an error in the price of products or services sold by an enterprise by only 1% leads to losses amounting to at least 1% of sales proceeds, and with elasticity of market demand, these losses can increase to 2-3%. With a product profitability of 10-12%, only a 1% error in price can reduce profits by 5-10%. Similar losses arise when planning prices for raw materials, materials, semi-finished products and other input resources.

Such a dominant position of prices in risk assessment is explained by the fact that price changes affect not only the change in the cost indicators of sales, but also on demand, supply, that is, on the change in volume indicators of sales depending on their price elasticity. In addition, in the context of inflation, the dynamism of supply and demand, product prices and input resources, it is very difficult to predict the price even for a short-term period. Under these conditions, a ± 5% error in price is not uncommon. These examples show the extent to which price planning involves risk.

Different types of losses in the planning of production and economic activities are estimated in different ways. The development and implementation of an enterprise strategy is associated with many losses and untapped opportunities. However, when planning, it is necessary to take into account only random losses, which, for some reason, cannot be taken into account in advance in the planned strategy. Such losses should be probabilistic. Damage from them is defined as the product of the probability of their occurrence and the absolute value of the expected damage in the event of adverse events. In this regard, when analyzing losses, it is important to rank them, to highlight the most significant, most probable ones, in order to make a forecast of their occurrence in the planned period on the basis of the analysis performed.

The most important tool in the analysis of losses is knowing the causes of their occurrence. Risks can be classified depending on the reasons.

There are the following risk groups.

1. External risks.
1.1. Unpredictable external risks:
- measures of state influence in the areas of taxation, pricing, land use, financial and credit, environmental protection, etc .;
- natural disasters(earthquakes, floods, hurricanes and other climatic disasters);
- criminal and economic crimes (terrorism, sabotage, racketeering);
- external effects: environmental (accidents), social (strikes), economic (bankruptcy of partners, customers, disruption of supplies), political (ban on activities, etc.);
1.2. Predictable external risks:
- market risk (changes in prices, exchange rates, consumer requirements, market conditions, competition, inflation, loss of market position);
- operational risk(violation of operating rules and safety precautions, deviation from the goals of the project, inability to maintain the working condition of machines, equipment, structures, etc.);
2. Internal risks.
2.1. Internal organizational risks:
- work disruptions due to a lack of manpower, materials, delays in deliveries, unsatisfactory conditions, changes in previously agreed requirements and the emergence of additional requirements from customers and partners, errors in planning and design, unsatisfactory operational management of the strategy implementation process, etc.;
- cost overruns due to disruption of work plans, ineffective supply and sales strategies, low qualifications of personnel, errors in the preparation of estimates and budgets, claims from partners, suppliers and consumers.
2.2. Internal technical risks:
- change in the technology of work execution, errors in project documentation, equipment breakdowns, poor quality of supplied materials, raw materials, components, etc.
3. Other risks:
- legal (arising in connection with the acquisition of licenses, patents, copyrights, trade marks, protection of information using these methods);
- transport and customs incidents;
- risks associated with human health (bodily injury, fatal injuries);
- damage to property during dismantling and relocation, etc.

Knowledge of the causes and mechanisms of risk action allows you to find effective means of preventing and reducing them.

The central place in the assessment of entrepreneurial risk is occupied by the analysis and forecasting of possible losses of resources in the course of entrepreneurial activity. We remind you once again that we do not mean the consumption of resources, objectively due to the nature and scale of entrepreneurial actions, but random, unforeseen, but potentially possible losses arising from the deviation of the real course of entrepreneurship from the conceived, calculated scenario.

To assess the likelihood of certain losses, to predict the possible damage caused by the development of events according to the off-design option, one should first of all know all types of losses associated with entrepreneurship and be able to calculate them in advance or measure them as probable predicted values. At the same time, it is natural to want to evaluate each of the types of losses in quantitative terms and be able to bring them together, which, unfortunately, is not always possible to do.

Speaking about calculating probable losses in the process of forecasting them, one important circumstance must be borne in mind. A random development of events that affects the course and results of entrepreneurship can lead not only to losses in the form of increased resource costs and a decrease in the final result. One and the same random event can cause an increase in the costs of one type of resources and a decrease in the costs of another type, that is, along with increased losses of some resources, savings of others can be observed.

So, if a random event has a twofold effect on the final results of entrepreneurship, it has both unfavorable and favorable consequences, when assessing the risk, both must be taken into account equally. In other words, when determining the total possible losses, the accompanying gain should be subtracted from the calculated losses.

Losses that may occur in business and are estimated by the magnitude and probability of their manifestation, it is advisable to divide into material, labor, financial, time losses, special types of losses.

Material types of losses are manifested in those not foreseen by the entrepreneurial project additional costs or direct loss of material objects in the form of buildings, structures, equipment, property, products, goods, materials, raw materials, energy. In relation to each individual of the listed types of losses, their own units of measurement are applicable. It is most natural to measure material losses in the same units, in. which is measured by the amount of a given type of material resources, that is, in physical units of mass, volume, area, length, or in pieces, in objects.

However, it is not possible to bring together the losses measured in different units and express them in one value. You cannot add kilograms and meters. Therefore, it is almost inevitable to calculate losses in value terms, in monetary units. For this, losses in the physical dimension are converted into a value dimension by multiplying by the price of a unit of the corresponding material resource.

For a sufficiently significant amount of material resources in the form of objects, products, goods, the cost of which is known in advance, the assessment of losses can be carried out immediately in monetary terms.

Having estimates of probable losses for each of the individual types of material resources in value terms, it is possible to bring them together, while observing the rules of action with random variables and their probabilities.

Labor losses represent losses of working time caused by random, unforeseen circumstances. Directly measured, labor losses are expressed in man-hours, man-days, or simply hours of working time. The translation of labor losses into value, monetary expression is carried out by multiplying the labor hours by the cost (price) of one hour.

Financial losses occur in the presence of direct monetary damage associated with cost overruns, unforeseen payments, payment of fines, payment of additional taxes, loss of funds and securities. At the same time, financial losses are manifested when money is not received or received from the sources from which they should have been received, when debts are not repaid, the buyer does not pay for the products supplied to him, a decrease in revenue due to a decrease in prices for products, goods, services sold. Special types of monetary damage arise in connection with inflation, changes in the exchange rate of the ruble, in addition to the legalized withdrawal of funds from enterprises to the state and local budgets. Along with the final, irrecoverable, there may be temporary financial losses due to the freezing of accounts, late disbursement of funds, and delayed payment of debts.

Loss of time occurs when the business process is slower than planned, with a lag. A direct assessment of such losses is carried out in hours, days, weeks, months of delay in obtaining the intended result. To translate the estimate of the loss of time into a value measurement, it is necessary to establish what losses of income, profits from entrepreneurship can lead to random losses of time.

Special types of losses are manifested in the event of damage to the health and life of people, the environment, the prestige of the entrepreneur, as well as as a result of other events that have adverse social and moral and psychological consequences. Most often, special types of losses are extremely difficult to quantify, and even more so in terms of value.

Naturally, for each type of loss, the initial assessment of the possibility of their occurrence and the magnitude should be made over a period of a certain time duration, covering a month, a year, the period of business or another characteristic period.

When conducting a comprehensive analysis of probable losses for risk assessment, it is important to review the entire possible field of damage so as not to ignore the sources of risk. But it is equally important to identify which sources are prevalent.

Analyzing the types of losses listed above, it is necessary to divide the probable losses into determining and incidental, based on the very overall assessment their values. In the tasks of determining entrepreneurial risk, collateral, minor, minor losses can be excluded when quantitatively assessing the level of risk. If, among the considered losses, one type stands out, which either in magnitude or in the likelihood of occurrence obviously suppresses the rest, then when quantitatively assessing the level of risk, only this type of loss can be taken into account.

Suppose that, as a result of the preliminary analysis, it was possible to filter out the types of losses that are most significant in terms of magnitude and probability of occurrence. Further, it is necessary to isolate the random components of losses and separate them from the systematic components.

In principle, speaking of losses that lead to risk, it is necessary to take into account only random losses that are not amenable to direct calculation, direct forecasting and therefore not taken into account in the entrepreneurial project. If losses can be foreseen and predicted in advance, then they should be considered not as losses, but as inevitable costs and included in the calculation. So, the foreseen movement of prices, taxes, their change in the course of entrepreneurial activity, the entrepreneur must take into account in the main project.

Only due to the imperfection of the methods used for calculating entrepreneurial activity or insufficiently deep study by the entrepreneur of the initial business project, systematic errors can be considered as losses in the sense that they can change the expected result for the worse. Therefore, before assessing the risk due to the action of purely random factors, it is highly desirable to separate the systematic component of losses from random ones. This is also necessary from the standpoint of mathematical correctness, since the procedures for operations with random values differ significantly from the procedures for operations with deterministic values.

Let us now consider in somewhat more detail the structure of losses depending on the type of entrepreneurial activity, highlighting industrial, commercial and financial entrepreneurship. At the same time, we will note the most important factors that generate risk, and indicate what are their main manifestations, that is, the losses that occur in this type of entrepreneurship.

In the course of the subsequent presentation, speaking about probable losses, and bearing in mind that these are random variables, we mean by the magnitude of losses either the value of a random variable, or its generalized characteristic, for example, the mathematical expectation, the average value. Since the dependence of losses on individual factors is considered, that is, the probability of those OR OTHER values of the factor is known, from it it is possible to establish the probability of the values of losses corresponding to a given value of the factor.

Before proceeding to the analysis of the manifestations of accidental losses in industrial, commercial, financial entrepreneurship, let us point out some specific sources, types of losses and factors influencing them.

Accidental losses include losses caused by the impact of unforeseen political factors. Such losses pose political risk. It manifests itself in the form of an unexpected change, depending on political considerations and events, in the conditions of economic and economic activity, creating an unfavorable background for the entrepreneur and thereby capable of leading to increased resource costs and loss of profit. Typical sources of such risk are an increase in tax rates, the introduction of compulsory deductions, changes in contractual conditions, transformation of forms and relations of ownership, alienation of property and funds for political reasons. The amount of possible losses and the degree of risk determined by them in this case is very difficult to foresee.

Losses due to natural disasters * leading to the loss of economic resources are quite close to the extent of the unforeseen.

Possible losses caused by imperfect methodology and incompetence of persons who form a business plan and calculate profit, income, and revenue are very specific. If, as a result of the action of these factors, the values of the expected, calculated values of profit, income, proceeds from an entrepreneurial project are overestimated, and the actual results obtained are lower, then the difference is inevitably perceived as a loss. Although in reality, if the nominal values of profit (income) were determined correctly, then there could be no threat of such conditional losses. But if the estimated profit is overestimated, then its shortfall will certainly be considered a loss and there is a risk of such losses.

A special place is occupied by the entrepreneur's losses caused by the dishonesty or insolvency of partners. Unfortunately, the risk of being deceived in the transaction or facing the insolvency of the debtor, the irrecoverability of the debt is quite high.

We now turn to consideration of more trivial situations of threat of loss and risk in relation to typical types of entrepreneurship. By talking about the causes of losses and the factors that determine them, we thereby gain access to ways to reduce risk, suppress it. We emphasize again that it is almost impossible to completely avoid risk. But knowing what creates losses, an entrepreneur is able to weaken their threat, reducing the effect of an adverse factor.

So, let us characterize the losses, the potential of which gives rise to economic, entrepreneurial risk.

A. Losses in manufacturing entrepreneurship

For industrial entrepreneurship the following losses are characteristic:

A decrease in the planned volumes and sales of products due to a decrease in labor productivity, equipment downtime or underutilization of production capacities, loss of working time, lack of the required amount of raw materials, an increase in the percentage of rejects leads to a shortfall in the planned revenue. The probable losses dD in value terms are determined by the following expression:

Where O is the probable total decrease in the volume of production;

C is the selling price of a unit of volume. A decrease in prices at which it is planned to sell products due to insufficient quality, unfavorable changes in market conditions, falling demand, price reform leads to probable losses, determined by the formula:

Where DC is the probable decrease in the price of a unit of product volume; О - the total volume of products planned for release and sale.

Increased material costs due to excessive consumption of materials, raw materials, fuel, energy, lead to losses determined by the relationship:

LD - DM] - C | + l M2 "Tsz +

Where M is the probable overexpenditure of a material resource;

C is the price of a resource unit.

Other increased costs may arise from high transport costs, sales costs, overheads and other incidental costs.

Overexpenditure of the planned size of the wage fund leads to losses either due to the excess of the planned number, or due to the payment of a higher than planned level wages individual workers.

The payment of increased deductions and taxes may take place if, in the process of implementing an entrepreneurial project, the rates of deductions and taxes change in a direction that is unfavorable for the entrepreneur.

We should not forget about the possibility of losses in the form of fines, natural loss, as well as caused by natural disasters, epidemics, although it is not possible to take into account such losses by calculation.

B. Business losses

We list and characterize the most important types of losses that should be considered when assessing commercial risk.

An unfavorable change (increase) in the purchase price of a product during the implementation of an entrepreneurial project, which was not taken into account in the project and was not blocked by the terms of the purchase agreement, leads to probable losses of DD:

Where C is the likely increase in the purchase price;

О - the volume of purchases of goods in physical terms.

An unexpected decrease in the volume of purchases in comparison with the planned one causes a decrease in the volume of sales, that is, the scale of the entire operation. If, at the same time, due to the indicated decrease in volume, both expenses and income are proportionally reduced, then the loss of profit (income) is calculated as the product of the decrease in the volume of purchases by the amount of profit (income) per unit of the volume of sales of goods. However, there is usually a part of the so-called fixed costs that do not depend on the scale of the operation. In this case, the losses will turn out to be higher, since the costs per unit of volume of goods sold will increase. If this increase exceeds the calculated profit per unit of commodity, there is a tangible risk that the operation will not be profitable at all.

Patents of goods in the process of circulation (transportation, storage) or loss of quality, consumer value of goods, leading to a decrease in its value, can cause damage, the level of which is estimated by the product of the amount of lost goods by the purchase price or by the product of the spoiled quantity by a decrease in the selling price.

The excess of distribution costs in comparison with the target leads to a corresponding decrease in revenue, income, profit. Among the possible reasons for the increase in costs may be unforeseen duties, deductions, fines, additional costs.

A decrease in the price at which the goods are sold in comparison with the design one causes losses in the amount of sales, multiplied by the decrease in price.

A decrease in sales volume caused by an unpredictable drop in demand or demand for a product, its displacement by competing products, restrictions on sale, can generate losses of revenue, income, profits, measured by the product of the volume of undersale by the selling price.

B. Losses in financial entrepreneurship

Under financial risk refers to the risk arising in the implementation of financial entrepreneurship or financial, monetary transactions.

In fact, this is the same commercial enterprise, but securities or currency act as a commodity. So when analyzing the factors and types of financial risk, you can use the set that was presented when describing commercial risk, adjusted for the specifics of money and securities as a commodity.

Along with general provisions and approaches typical for all types of entrepreneurial risk, when assessing financial risk, it is necessary to take into account such specific factors as the insolvency of one of the agents of a financial transaction, changes in the exchange rate of money, currency, securities, restrictions on currency and monetary transactions, possible withdrawal of a certain part of financial resources in the process of doing business,

When assessing entrepreneurial risk, the time factor plays an important role. It should be borne in mind that the values of probable losses depend on time and this dependence manifests itself in two ways.

First, the risk is associated with the duration of the entrepreneurial project. So, along with a risk assessment covering the entire period for which activities are designed and results are expected, in relation to long-term intentions, a separate assessment should be carried out by months, years or other time periods of the total period of entrepreneurship.

Secondly, a measure of risk, the probability of losses can change over time due to changes in the conditions for the implementation of an entrepreneurial plan. The latter circumstance makes it necessary to distinguish between the initial (project) and current risk. The initial risk is assessed at the stage of preparation for the implementation of the project, in the process of initial calculations and justification of the feasibility of carrying out the entrepreneurial life. The current risk is assessed already during the implementation of the project, in the process of the started entrepreneurial activity.

Note that a situation is not excluded in which the conditions change over time for the worse as compared to the expected ones so strongly that a revision of the decisions made will be required. In an unfavorable combination of circumstances, the current risk can not only significantly exceed the initial one, but also exceed the limiting limiting values. In such an environment, it becomes necessary to study the alternatives associated with the termination of this type of entrepreneurship.