Ch 1 · Financial Policy & Corporate Strategy / Risk Management

5 concept points · 3 formulas · 4 exam-critical points.

📘 Core concepts

• 1Financial policy aligned with corporate strategy (growth, profitability, market position).
• 2Risk types: business, financial, operational, market, credit, liquidity, country.
• 3Risk management process: identify → assess → mitigate → monitor.
• 4Tools: hedging (forward, futures, options, swaps), insurance, diversification.
• 5VaR (Value at Risk): max expected loss at given confidence level over time horizon.