Investment Risk Management

Risk has two sides: underestimating it harms the investor, while overestimating it prevents the implementation of bold business projects. This book explains, from the point of view of the practitioner, the analysis of investment risk - a proper account of adequate risk management strategies - and offers an objective and readable account of the most common investment risk management procedures. It will not be highly mathematical, although mathematical formulae and technical graphs will be used where necessary, and will not rely on excessive technical jargon. The author also covers guidelines of regulatory institutions that protect the market and the investor: Bank of International Settlements, US SEC and UK FSA.

Risk has two sides: underestimating it harms the investor, while overestimating it prevents the implementation of bold business projects. This book explains, from the point of view of the practitioner, the analysis of investment risk - a proper account of adequate risk management strategies - and offers an objective and readable account of the most common investment risk management procedures. It will not be highly mathematical, although mathematical formulae and technical graphs will be used where necessary, and will not rely on excessive technical jargon. 

The author also covers guidelines of regulatory institutions that protect the market and the investor: Bank of International Settlements, US SEC and UK FSA.

Text shows how a new investment methodology is required to protect investors. Explains why regulators react slowly to investment scams, when pension funds fail to protect their investors, and why market boom-busts occur in the trade of worthless stocks. Shows how best practice risk management can help in spotting early warning signs. DLC: Investment analysis.

"Risk is an everyday hazard facing everyone, but investors in particular. However different 9/11 and Enron may be, their consequences for businesses around the globe can hardly be overestimated. Risks can usually be mitigated, but not eliminated completely. The art of investing is to hover between risk and return. Risk management is a core discipline for successful investors. 

In his new book Yen Yee Chong helps investors to understand the ins and outs of risk management and its methodologies. He presents a large number of case studies that contribute to investors' insights in what is going on in practice. 

One of the book's interesting dimensions is that it explains the concept of organic risk management (ORM) focusing on integrating operational risk from different areas. This makes it a must for managers, since ORM attempts to examine and conduct damage limitation to stop one infected part hurting the whole corporate entity."
—Prof. Dr. M. Peter van der Hoek, editor of Public Finance and Management, Erasmus University, Rotterdam, Netherlands, and Academy of Economic Studies, Bucharest, Romania

Recent market boom-busts have happened, and will continue to happen partly because apparently reputable institutions oversell risky or worthless investments. 

Following Enron, Worldcom, Equitable Life and other scandals it is apparent that a new investment methodology is required to protect investors. Rather then relying on market reputation, investors need to be able to look past the sales hype to discover the true situation. 

Operational risk management and a forensic investigation of investment provide the groundwork for such a methodology. Investment Risk Management explains 
why market boom-busts occur in the trade of worthless stocks
why regulators react slowly to investment scams
when pension funds fail to protect their investors
when investors pay for worthless 'professional' services
how companies pay too much for management 'stars'
whether Basel II and IAS accounting rules protect the investor

"Investment Risk Management can easily end up buried in technicalities while missing the context. There is a refreshing style linking theory with well-reported case histories that gives anyone accessibility to the subject. This is an ideal book for the growing band of 'Risk Professionals' needing a broader understanding of their field. It takes you on a journey from the use of the Arc to BASEL II as methods of risk mitigation while transferring knowledge of valuable techniques on the way."
-Simon Lamoon, Programme Manager, M&G Limited, Retail Operations 

"Yen Chong has advised banks and financial institutions in a wide variety of countries. As such, he has seen a lot of what he writes about in Investment Risk Management. He builds a strong case for investments in risk management. The stakes are high, as are the costs of risk management. After making a case for risk management, Mr Chong goes on to recommend strategies and tools for a balanced approach to avoiding, controlling or mitigating the inevitable financial risks all businesses face in today's uncertain world."
-Prof. Charles Scott, Sellinger School of Business, Loyola College, Baltimore 

"A useful guide covering many real-life case-studies where substantial financial loses occurred. Highlights how best practice risk management can assist in spotting early warning signs. Concentrates on realistic scenarios rather than complex mathematics."
-Dr Mamdouh Barakat, President and CEO, MBRM - MB Risk Management