EIRP Proceedings, Vol 3 (2008)
THE FINANCIAL INSTRUMENTS FOR RISK MANAGEMENT ON THE INTERNATIONAL FINANCIAL MARKETS
Abstract
The international financial market is extremely volatile because of the influence of a
numerous objective and subjective factors. Because of these, în their fight for maximizing the profit, the credit
institutes confronts permanently with all sort of risks.
It is important to know that the risk is generated by a numerous operations and procedures. From these
cause, at least în the financial field, the risk must be considered as a complex of risks, în the sense that they can
have common causes, and producing a risk can generate a chain reaction, and producing other risks. As a
consequence, these operations and procedures can permanently generate an exposure to the risk.
The risk management is the key function of the financial institution, which act on the international
financial market. For doing this, it must be used some important instruments that can conduce to avoiding risks
or dimensioning them.
numerous objective and subjective factors. Because of these, în their fight for maximizing the profit, the credit
institutes confronts permanently with all sort of risks.
It is important to know that the risk is generated by a numerous operations and procedures. From these
cause, at least în the financial field, the risk must be considered as a complex of risks, în the sense that they can
have common causes, and producing a risk can generate a chain reaction, and producing other risks. As a
consequence, these operations and procedures can permanently generate an exposure to the risk.
The risk management is the key function of the financial institution, which act on the international
financial market. For doing this, it must be used some important instruments that can conduce to avoiding risks
or dimensioning them.
References
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