Risk Management in Finance

  1. Liquidity Risk
    1. Types of Liquidity Risk
      1. Funding Liquidity Risk
        1. Inability to Meet Obligations
          1. Funding Mismatches
            1. Rollover Risk
            2. Market Liquidity Risk
              1. Inability to Sell Assets Quickly
                1. Price Impact of Liquidation
                  1. Bid-Ask Spreads
                  2. Contingent Liquidity Risk
                    1. Off-Balance Sheet Commitments
                      1. Contingent Claims
                    2. Measuring Liquidity Risk
                      1. Liquidity Ratios
                        1. Current Ratio
                          1. Quick Ratio
                            1. Liquidity Coverage Ratio (LCR)
                              1. Cash Ratio
                              2. Liquidity Gap Analysis
                                1. Maturity Mismatch Analysis
                                  1. Cash Flow Projections
                                    1. Behavioral Assumptions
                                    2. Net Stable Funding Ratio (NSFR)
                                      1. Market-Based Indicators
                                        1. Bid-Ask Spread
                                          1. Trading Volume
                                            1. Market Depth
                                              1. Price Impact Measures
                                              2. Stress Testing
                                                1. Liquidity Stress Scenarios
                                                  1. Survival Horizons
                                                2. Managing Liquidity Risk
                                                  1. Cash Flow Forecasting
                                                    1. Short-Term Forecasting
                                                      1. Long-Term Forecasting
                                                        1. Scenario-Based Forecasting
                                                        2. Maintaining Liquid Asset Buffers
                                                          1. High-Quality Liquid Assets (HQLA)
                                                            1. Liquidity Buffer Sizing
                                                            2. Diversifying Funding Sources
                                                              1. Bank Loans
                                                                1. Capital Markets
                                                                  1. Securitization
                                                                    1. Retail vs. Wholesale Funding
                                                                    2. Contingency Funding Plan (CFP)
                                                                      1. Plan Development
                                                                        1. Stress Testing CFP
                                                                          1. Early Warning Indicators
                                                                          2. Access to Central Bank Facilities
                                                                            1. Discount Window Lending
                                                                              1. Emergency Liquidity Assistance
                                                                                1. Collateral Requirements
                                                                                2. Liquidity Transfer Pricing
                                                                                  1. Internal Funding Costs
                                                                                    1. Liquidity Premiums

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                                                                                4. Credit Risk

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                                                                                6. Operational Risk