Topic: knowledge about risks and their types. (Read 429 times)

I think it depends on the debate before we say that it is better. Before we present a strategy and say it is that it is the best, we need to try it on our own first, so that we will have a proof but if it's about trading, gambling, and others... the results might change for the other user. It is still our choice if we use someone else strategy or not, so we must only blame our selves if in case our decision is wrong.

Concern is always there no matter if you rely on your self or to others and no matter which side we choose, wrong decisions are still there as well that can occur sometimes or even most of the times, especially if we are hard to learn from our mistakes.

Gambling is a danger zone where once one is addicted he loses everything in his life. taking a risk doesn't mean you have to leave it to luck like gambling. Risk taking should be where you can lose but use your wits to make huge profits. Investing money somewhere is definitely risky but using your personal strategy to bring the desired profit from there is the real success. So you have to take risks to be successful. But not gambling

Every risk has a consequence and if we are not aware about it then the pains that would come after taking such risk if we are not lucky is going to be unbearable. I have witness where an investor fell to zero, like he had no single money in his life and couldn't know where to start again. He became poor after tasting wealth.

The most important thing about knowing the risk involved  is because we can look for a way to bypass everything. We will make sure we find a way to harness the situation by avoiding what will cause those risk.

You are right because there are times when each one of them will prefer their own opinion to the other person's opinion and before you know it a lot of confusion arises and just like you said, something that would have been settled earlier will now take a lot of time to debate and deliberate which is better and it doesn't even mean that the one they presented as the best strategy will make them become more successful so sometimes it is better to make personal decisions knowing fully well that if anything happens you will bear the risk alone it will even make you to be more concerned about how your can present a good analysis so that you don't end up making the wrong decision.

Its not really that something could be considered to be a consequences but rather it would really be that something a chance or probability that you would really be able to experience loses on which this is really that typical when you do hover yourself on investing which its part of the risks. This is why if you cant really be able to bare up with the risks then you could opt out anytime.
Doesnt matter on which type it would be on which it would really be that still on the same thing on when it comes to risks involved. It is really just that depending on how someone
will really be able to handle it out because if you dont like on losing money then dont risks.

Even just simply living your life and with the decisions accompanied with it will really be having that risks. So there's always a risks and making up some good decisions
will really be something that you would really be needing.

Taking risks brings some consequences. Before taking risks, it is necessary to analyze the consequences that may arise and act according to this analysis. As you say, taking risks without knowledge is like gambling. Acting without knowing leads to moving forward without knowing where to go.

Before investing, we must learn the market and investment. We must think about all risks and plan ahead. Acting without planning can cause mistakes, especially when investing.

If we know what the risk is, it becomes easier for us to invest and we can more easily determine our move in the face of any situation.

Strategic risk, for example. The hidden prejudices that cloud our minds matter more than the facts. Everyone has confirmation bias, where they only pay attention to information that supports their ideas. Imagine getting a half-baked hypothesis about Bitcoin travelling to the moon and seeing every spike as a sign from the universe. You're neglecting the market's three-legged stability

It's not simply money. Risky reputation? Some existential nonsense there. Everyone fears failure, especially when starting a new business or project. It's about losing face and self-worth, not simply money. Interestingly, the solution isn't to play it safe. Quite the contrary. Man, accept failure. I've failed at many things. All of them taught me something and helped me grow. This mindset adjustment is needed. Failing is a stage, not the end. You'll be miles ahead of the competition in today's cutthroat world if you can grasp that

Never thought of risk that way, I feel like if I've known about this a long time ago, I'd be in a better position in life right now but I can't complain, I'm doing fine anyway. I specifically like the part where you said that if we don't take steps about the risks or not taking them, it resonates heavily to me because I get it, if we just stand there paralyzed about what to do next, we're never going to see any changes to our lives or even improvements which should be the thing that everyone aim for in life.

I think everyone who takes any risks must be aware of what they are deciding and know the impact in the future. I don't think it's advisable to take risks in gambling Many bad impacts have occurred in our environment. I think taking a risk has a much better or beneficial impact on us than gambling, for example taking a risk to invest. If you don't understand investment, we should learn about it first before jumping into it. If we understand the risks, then we can start deciding what assets we want to buy.

That is very true my dear mate, but the fact is that different people have different understanding of risk depending on the situation that they find themselves, that is to say that risk means different things to different individuals, some people will say that risk is a chance of loss, some will also say that risk is a combination of hazard, some others will also say that risk is the possibility of an unfavorable event occurring, and some people will also go further to say that risk occur when the future is occur and that everyone is a risk manager not by chance but by share necessity and so many other understanding of risk that people might apply.

In every of these definitions, there is one major thing that they are trying to portray which is loss and that we face risk every single day of our lives and that it is very pertinent that we understand the concept and have a proper knowledge about risk and know how to handle the circumstances when the time comes. just like the op have listed different types of risk, all these types of risk affect every sphere of our endeavor, however, it is of utmost importance to have a prior understanding and knowledge about risk before its occurrence because it is part of daily lives.

I like this point. This point reminds me of my trading journey which always ends less pleasantly. But, even so, this is also a lesson for me how valuable money is, especially if it is obtained with the results of hard and hard work.

We are well aware and must be more careful in trading activities because we come here not to burn our money in the blink of an eye.

Well, I wasn't aware of this risk classification either, and I partly agree with this explanation. I think that risk is a risk. Financial, strategic, operational... one problem always leads to the other, so for me, it's all the same. One risky move (you can take a risk type from OP) can
be beneficial or can lead to losing a lot, it's like that whenever we decide to take some risk.

Instead of classifying risk, I would also focus on assessing the risk itself and what that risk can bring or take away. We can give any kind of
name to a risk we take, but it's still just a risk that has chances to give us what we want or take us down, so why to complicate it?

Everything we do in terms of work definitely has its own risks, but if some of the risks we face don't give us any benefits and are more dangerous for us then there's no harm in avoiding them, so there are things we need to consider in determining targets according to our goals. we want to do and we don't have to fulfill everything if it is more dangerous for us, so we still have to consider every risk even if there are things that are tempting.

Life is full of different types of risk, but we are taking them and living our lives healthy and happily. This proves one thing, that the human willpower to take the risk and to follow it through has not bounds and hence we must be careful about weighing out the risks we are taken and attempt to minimize those that are not necessary.

We cant eliminate all of them but we have this risk/benefit ratio thing that can help us judge what would be a more beneficial risk as compared to less beneficial risk.

It is a theoretical concept but we apply this everyday without knowing.

Life is all about risk management. Every decision you make has risks. It might sound funny but when you leave your home and go to a grocery store, you are taking many risks. If you take the car, you can have a car accident. If you walk, a car may run you over. You might get poisoned from something you ate at a restaurant. You may get robbed. Lots of crazy shit happen to people every day and you don't see or hear most of them. At this very moment thousands of people are getting fucked in ways you can't even imagine.

So, when it comes to making investments, you have to think over all of those potential risks. Obviously you can't calculate everything and there will always be a disaster at the next corner waiting to happen which you didn't think it could happen. A successful business person usually thinks more and takes more precautions than an average Joe. That's what makes him a successful person because he has those abilities which the majority of people lack.

Having an understanding of risk is of course very important and for those who are lazy in facing risks due to a lack of knowledge about risk management, of course they will not be able to develop better than they are now, so it is important for us to be able to have a good understanding of risk management in order to be able to manage risks. that they will face either in their business or work.

I concur completely. The awareness of risk holds a profound significance, not just within the realms of business but also in our day-to-day choices. Delving into the essence of risk equips us with the capability to tread wisely and on an informed basis; it, in turn, heightens our probability for success. Moreover, an investor who acquaints themselves with the study and comprehension of risks relating to their considered venture gains an enormous edge.

To take courses in risk management is very useful, particularly for those individuals who have recently started their careers or are interested in broadening their knowledge. The course provides not only a picture of what the risk entails but also an overview of how to evaluate and then mitigate it: understanding and controlling the risk is a milestone on the way to success; it's not just about preventing failure, but also about maximizing possibilities for further successful activity. With this information in mind, a person can make better decisions, not only be ready to face challenges but also be proactive.

It is true that this is a very simple understanding and in this life there are many factors and risks in making a decision that cannot be separated from a reason and we have to choose, and for beginners the risk of gambling cannot be understood in greater detail and increases the risk of large losses because lack of insight and the strategy implemented is not good in terms of readiness, that is the main factor.

Life is a risk as many would say, getting to know the risk that is associated with what ever we are doing is very important. In my opinion, financial risk is a very important knowledge that everyone must have. We all need money to survive and money can be made through different means, if you are not knowledgeable about financial risk, you might end up to even lose some money. Take for example, those people that invest in things they don't have knowledge about, they can lose their money. If you invest in an asset because you saw someone investing there, that isn't being too smart, being smarter is when you know the risk of that investment before you invest.

Yeah and without the proper knowledge to manage those risks will end our career so badly so it really is a mist to acquire enough knowledge before jumping into something that pose risks because if you are going into a war without a weapon and defenses then it's a suicide same as what OP is trying to tell us.

Useful piece of article as it clearly describes about types of risk in brief and there are people who consider these risk to an extend and some exaggerate these risk and end up being idle without taking any steps be it business or job hence apart from the definition we need to learn how to apply these risk in a calculated way in our daily life. People who don't buy even during the dip are real example of the statement which I am trying to convey.

That is true, it doesn't even have to about trading, if you learn a skill and you are amazing at that, then you are going to make money from it and just live doing what you do best. You can be a painter, a writer, a car mechanic, a crypto trader, a coder, a teacher, doesn't matter what you do if you are one of the best in your field then you are going to end up with making a lot of money.

The trick is that you should be able to provide a proof of that to people, because if you can do that, while that may take a while, eventually you will grow bigger and bigger, social media and internet allowed us to provide proof that we are doing a lot better and we should consider how we could grow a bit more, and get attention to earn more money.

Risks are the result of what we get and can be greater if we do not know how to handle them. Most people find it difficult to handle the risks and tend to let them go and that causes the risks to become large. If we take the time to learn about risks, we will know how to reduce them.

We can also find out how to prevent the risk from getting bigger. This will ensure that we do not fail and can continue with the plans we have made well. We will also try to always be careful by checking what we have done and our next plans.

As we learn to handle risks more often, we will not worry if the risks get bigger. We can only reduce the risk so that it does not have serious consequences.

In any field, knowledge is the main capital to be successful. someone with high knowledge, or mastering a certain field, then they can more easily become successful, by earning a lot of money from their expertise, then the next stage is good financial management, so that the money earned can be used wisely, even can be invested in other fields, so that the money will work on its own, so that we can enjoy it, The knowledge that is mastered must take into account risks and rewards, so that we know what and how it will happen later, this is useful for determining steps to overcome it.

It's clear that knowledge is the basis of anything. Yes, having good knowledge regarding the risks in the crypto space is very important. because, with that, we become more aware and alert to various risks that will be faced in crypto and the economy in general. So whether we like it or not, we have to have good and appropriate risk management. Because, proper and good risk management will help us to avoid various risks that will frequently occur and be encountered. Then, this risk management can also help us in implementing something so that we can minimize losses and can actually optimize the gains. With good and wise risk management, we can be more alert about what decisions we will make next too. So. It won't get any worse.

We live in a world that is unpredictable this is why we need to calculate and make plans for the future. But the first thing people should do is to have a sound knowledge about the business or investment they want to embark on. Many people will just calculate how much profit they will make from the business but they fail to understand that it might not be an easy run. There are challenges to overcome and risks to control. This is why I find this thread insightful. It should be a reminder that we should be prepared for uncertainties.

I was just working on a strategic vision at work today, so a lot of what the op mentioned seems relevant to me now. There are indeed different types of risks and they need to be accounted for. But I'd also add another thing: apart from types of risks, it's important to estimate how bad a risk is and how likely the unfortunate is to happen. For example, if Bitcoin suddenly costs $100 tomorrow, that's of huge negative impact, but the likelihood of that is low. Meanwhile the risk of a massive transaction fee spike till the end of the year can have significant impact if one intends to use Bitcoin at that point, and its likelihood is fairly high.

The process of understanding and managing risk is actually not complicated enough, although it is also not easy enough for a small number of people, especially for beginners who previously had no experience in dealing with any risks. I also quite agree with what the OP has expressed in this discussion topic because it is definitely quite useful for those who want to know some risks and how to manage them well. Because beginners usually also tend to be afraid of facing risks because they still don't understand how to deal with a risk appropriately.

Not only in business is  the knowledge of risk helpful, but it is also helpful in making life decisions and an investor who has understood the risk of the venture they intend to undertake, has already become 70% sure to get success.
Risk management courses and seminars also is a good idea for those who don't understand or need better insight in their field. It's just like having to attend and gain certification in HSE safety courses for those who work in the oil and gas or in sectors where the hazard and risk level is high.

Knowing the risk level involved is one step to achieving success.

You are right, as it will also help them to be determined or dedicated to work  and also make them to be strong, so without risks in anything we do, I don't think it will be achieve because I have come to understand that nothing beneficial comes with easy way and we can't be successful without going through process or risks and that is why we should also have the knowledge or idea to manage anytime we encounter those risks and know what to do in order to not a victim of circumstances and never forget to always seek help or support from those who are already ahead of us to gain more knowledge.

You raised a very important point here, we take almost all these types of risks everyday, but taking a calculated risk makes the difference. When taking calculated risks, you take risks that is worth the stress and risks that's worth your reputation being on the line. If you don't take risks that means you're not living because life itself is a big risk.

Even investing in BTC is a risk because the price is very volatile and you're not sure of the next trend. That's why you make calculated risks in your bitcoin investment by investing with your spare funds and money you can afford to loose, so you would not tamper with your investment until about 4 to 10 years when it must've become profitable.

Man is nothing without taking risks, you take calculated risks and succeed, you become a celebrity, and even if you take good risks and fail, you're still one step ahead of where you were previously and with your experience, you're one step up the ladder of success. Let's keep taking calculated risks!!!..

I have come to the realization for a long time about the importance of studying risks in any business so as to prevent loses from the business. No matter how much you claim to understand the intricacies of business, if you don't focus on learning the associated risks and skills towards curtailing such risks, you will have difficult time trying to achieve a successful business career.

Most people are always interested in the results without dedicating enough time to the process. Rather they are more interested in the ambitious business targets they house in their brains.

If you can read on strategic risk, I explain that that is why I said sure risk deals with decision making, and in decision making, we are directing to many factors, including analysis, adoption, and assessment, and without these 3 A's, you can’t trade anything in crypto currency's, and I am sure you also know that.

Let's take an instance where you wish not to put stop loss based on your trading. You also know that you are dealing with a higher level of risk and that you are capable of losing all that you have already invested for the purpose of trading. That means you are not at a reputational risk because you have to stake another fund to invest again. Which deals with decision-making because no one makes such decisions for you.

So this is simple science. Just read and direct it based on gambling, crypto trading, and business, and you will find out that all this is self-explanatory.

Among the whole risks you mentioned the one that causes emotions more is the financial risks because literally, every one wants to make profits in any business or investments they choose to venture into and when things ain't going to as planned a lot of people becomes so emotional so in order to be able to manage risks then you must remove emotions because every investment comes with risk so if you are not able to manage your emotions properly then you are most likely to face some challenges along the line.

Well, it's hard to expound it but in simple terms, taking risk is also a kind of gambling or simply like that. But yes, we have different understanding and thoughts about it. Having to take risk is actually telling what kind of person you are, others don't want to take it because they just can't. So, if you are able to move your life into the next level through taking risks with investments and businesses, it only means that you are doing well in life regardless of what will be the result of those risks.

Exactly, while we undergo in examining worst risk in an economy sector, reputations has been the most considerate because people would always regard you by your characters and exhibitions, how you trades on transparent and equality without trample to subue others while your interests is just your priority.

Stabilizing a reputable firm can as much cause viral recommendations where everyone wants to have deals with you basically because you can be accounted on.

Thank you for this comprehensive explanation of risks. Risks, of course, include all aspects of economic life, but what concerns us here are the risks related to cryptocurrencies and investing or trading in them in general.

Whether investing or trading in cryptocurrencies contains great risks if there is not much experience and knowledge of how to avoid risks. For example, investing in new projects contains high risks, so you must conduct research with great and careful care and not risk large amounts.

Also in trading there are strategies to reduce risks such as stopping loss, dividing capital, etc. These are important matters that should not be underestimated.

Thank you for sharing this information about risk. Everything we do carries some level of risk, so knowledge and preparation are crucial. I'm particularly interested in reputational risk. You mentioned that a small mistake can have devastating consequences. How can we mitigate this risk, considering that everyone makes mistakes, regardless of their experience? If the stakes are so high, it seems like people would be hesitant to engage in activities that put their reputation on the line.

     Actually, no matter where we go or whatever we do, the risk is always there with us, and even in every decision we make, it never goes away. It is also through risk that we are also shaped on how to properly manage the things that are important in our lives.

     So, everything you mentioned is correct, and I think that in general terms, we as communities or individuals should learn to handle risks properly when it comes to them, right?
We should accept the fact that risk is part of our life.

I can totally agree on reputational risk being the most dangerous or highest risk of them all, it's definitely one of those risk that you've got a hard time getting back into, it doesn't even have a tangible reward too at the surface level, your reputation will just improve but sometimes that's it. I'm a bit confused why you didn't mention that if you failed to do what needs to be done when you've got your reputation at risk that your character and the respect of those around you is going to plummet the most because that's how it works most of the time, people will see you differently when you risk your reputation and depending on your results, it can be positive or a negative one.

The fact that strategy and analysis are not done by one person does not mean that the chances of success are always higher. In fact, because they are done by many people, strategy formulation and analysis can even be more difficult and confusing, and simple decisions may take time to be debated and argued over by all the people involved in the decision-making process, so the process may not be as smooth and yield the expected result as when just one person is involved.

Just want to say that not all gambling games are based purely on luck. Poker and sportsbetting are couple examples that you also need skills, knowledge and experience to have a high winning chance in your games. But of course, most casino classics are based on luck.

On the note of the different risks that we are facing with, each case is unique, hence, you need to consider it as different from your previous experiences. One should identify potential risks involved on his scenario by checking all the angles contributing the possible success or failure of your decision.

If you are taking risks without knowing about it nor having learned it then you are definitely gambling. Gambling is just taking chances based on luck and nothing else. No logic whatsoever.

There’s no computations either so everything really is pure luck but once you start studying about risks and winning for it then that is when you can say that that is no longer taking it by chance and you have yourself to congratulate.

I didn't know that there are classifications of it and described as how OP did it. To be honest, I don't think people that are taking risk didn't know that they are taking risks. They know for a fact that they do it and they don't mind taking it. In layman's term, it's a gamble of whatever you're taking. Whatever classification you have mentioned and if someone is taking a risk on it, the easiest logic to understand it without being confused is you are taking a gamble.

In my opinion there are only two major types of risks the calculated risks and the non calculates or blind risks.

In calculated risks we do some research and the after putting all the efforts and techniques we came to a conclusion that now this trade will make us profits and then we invest. In blink risks we just invest by seeing the hype of a project or by so-called signals group.

I totally agree with your explanation of information, especially it will be very useful for newbies who don't know much about risk. It will be very helpful and useful for newbies. To get anything good we need to manage the risks that come our way, and for that we need to know and understand the risks well. This is a help post, so I think it should be in the Beginners & Help thread.

Life in itself is a risk, if you choose to live, you must take risk as a part of your lifestyle. Talk about relation and take away the risk that's in it and walk into a relationship that will fail before it even starts, are you talking about choosing a business part or a business partner? Should we talk about walking on the street or engaging or relating with people in our environments?

Risk is part of life and it's part of what brings out the best in us, if you're afraid to risk it all, you will never attain an half level of greatness. Know the risk, walk with the reality and always give it your all as though you have zero obstacle. That's definitely my nuggate.

It's a very interesting review and we can put this, for example, in the case of market volatility where the presence of quite a lot of new tokens, especially memes and there are also new Altcoins that are not verified, can be very risky if you choose the wrong one.

In other cases, hacker attacks result from saving passwords online, or projects that fail, so the potential for losing money is quite high here.

Thanks for this very informative post!

I agree that many people do not actually know what entails a risk. This results to them encountering huge losses than they would have if they had just learned about risks. In every investment, there’s always a risk associated and to say that all investments would guarantee you a 100% return is crazy. Yes it might be possible but only if you properly manage the risks that will come your way.

Knowledge about risk is very necessary as it put you on the advantage on the advent of emergency, risk is something we need not to play with because risk management is key both at home, in your office and in the industry

It comes to me that many people engage in risk without knowing what risk is all about, which arouses my interest in creating this thread in order to address more about risk and how critical it might be when you know about it

First of all, WHAT IS RISK?

Risk, in simple terms, is the probability that your action, decision, or wish can be useful or harmful to you. But the hidden definition behind it is that going into risk without knowledge always comes with a negative consequence. That is why you need to know more about the context of risks. Understanding risk is very important in both personal and business contexts to save and guide you against a critical downfall or even bankruptcy and enhance good and better decision-making for individuals, groups, households, or even organizations by identifying,investigating, assessing, and addressing risk before diving into it.

TYPE OF RISK

1. Financial risks
2. Operational risk
3. Strategic risk
4. Compliance risk
5. Reputational risk 

EXPLANATION

1. Financial risk: from the name financial risk, what will first come to your mind is that all this will be associated with finance, and that is actually what it means, but it is more focused on company loan risk, the ups and downs of finance in business, individuals, and groups. This risk does not only focus on companies but also affects individuals and groups of people, but it mostly affects marketing businesses, which include equity risk, interest rate risk,commodity risk, and currency risk.Financially, risk simply means losing money on an investment or market, which might be a reason for poor risk analysis and poor decision-making.

2. Operational risk: Operational risk can be defined as a type of loss that happens as a result of poor management skills, which can be as a result of the employee or the employer, which usually happens in higher business fields, and mostly it is as a result of poor management, which can also include criminal operations like fraud, and the only solution for this is when you are looking for employers. You should always focus on who you are employing, and most importantly, you should always include these two interviews, which include hard work and financial resistance.

3. Strategic risk: this is a type of risk that depends on your decision-making. Why I said so is that this is the level of risk that determines whether you will succeed or not because strategic risk depends on the strategy that you as an investor will use in order to gain or lose, which is sometimes related to financial risk because it also focuses on assessment, analysis, and the most important aspect, which is decision-making.    So this type of risk deals with a lot of concentration; if not, you will always end up regretting it. Crypto trading is a type of risk that deals with higher concentrations, which is why it is classified as an example of strategic risk.

4. Compliance risk: There is a proverb that says a single tree cannot make a forest. This is what they really mean, which is that two or more people bring their ideas together in order to invest. That means all the strategy and analysis will not be done by a single person but by many people, which shows that it will be simpler and have a higher expectation of being successful. That is why most knowledgeable people engage in this type of risk because it has higher risk management than all of the other risks.

5. Reputational risk: this is a type of risk that is the most dangerous risk that you can ever think of, because with a small mistake you will lose everything. This is a type of risk that is most done by newbies in business, because if the investment that they do crashes or fails, they will lose all their capital or shares that they have already invested in, which is capable of affecting any other business, but it most affects the newbies because there are certain businesses that are included as reputational risk businesses, like importing and exporting of goods, shipping, and many others.