ERM: LESSON 3 (PARAPHRASED)

The type of risk that exists naturally, without applying any control methods.

The process used to spot and evaluate potential risks and the actions taken to control them.

Specific signs or data points used to detect rising or existing levels of operational risk.

The portion of risk that still remains after applying control measures.

A share of ownership in a business, along with a portion of its profits.

A loan you give to a company or government, with the promise of being repaid with interest over time.

The risk of money losing its buying power over time due to rising prices is called

The index used to indicate how much volatility is expected in the S&P 500.

The risk that makes it hard to quickly buy or sell an asset without affecting its market price.

Spreading your investments across different types of assets to lower risk.