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RISK ANALYSIS AND ITS TYPES
Yakubova Nargiz Tursunbaevna
Tashkent state economy
University Associate Professor Ph.D
Abstract:
Risk analysis is a critical process in identifying, assessing, and
managing potential threats that could impact the success of a project, business, or any
decision-making scenario. This paper explores the concept of risk analysis,
emphasizing its importance in mitigating negative outcomes. It also categorizes the
main types of risk analysis, including qualitative, quantitative, proactive, reactive,
internal, and external risk assessments. By understanding these types, organizations
can adopt more effective strategies to anticipate and respond to uncertainties,
ultimately improving their resilience and decision-making processes.
Key words:
risk, risk management, profit, risk factor, insurance, investment,
market, financial risk.
Introduction. This type of risk can only lead to losses. Risk analysis can be divided
into 2 complementary types:
1) Qualitative. 2) Quantitative.
Qualitative analysis - accordingly, is simpler, and its main purpose is to identify
the development of the risk factor. Studying the risk aspects. To clarify the risk.
Quantitative risk analysis - to determine the size of a particular risk and planning
risk - is a problem.
Recently, the execution and implementation of work has become a separate form
of professional activity. This issue is not isolated from other management functions.
Issues related to protecting participants in the activity from various risks are solved
both in the development of financial requirements, in the requirements for the duration
and budget, and in the production of products. Since risks are present at all stages of
the activity, risk management functions continue until the end.
Methods. Project risk management focuses on the following issues:
- classification of risks;
- planning risks and management methods;
- information provision for risk management;
- monitoring and determining the prospects for risks;
- risk management;
- organization of risk management;
- optimal justification of the use of risks and increasing their efficiency.
Risk management requires risk management technologies and knowledge in
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various areas of activity. How can risk be achieved at the same time?
1) risk assessment;
2) risk implementation;
3) determination of risk management controls and methods;
4) risk acquisition and control;
5) risk financing;
6) obtaining support.
The stages of risk identification and management are also called risk analysis.
In this case, risk is included in the qualitative analysis, risk measurement analysis.
Among the methods of risk analysis, the most popular in the theory of risk management
are:
- statistical method, method of statistical experiments;
- observational analysis;
- method of expert assessments;
- analytical methods, etc.
The importance of risk analysis is to provide the necessary information for making
potential additional decisions.
Risk management and methods are a very important step. A specific method can
be used to determine the exact measures. The implementation of this stage should be
studied first before making a decision. Delay in making a decision can lead to serious
consequences for the participant or serious consequences between the participants.
Risk management helps to determine the combination of risk and profit. The main
goal of risk management is to reduce them.
The main stages of risk management What steps is risk management divided into:
- assessment of the risk factor;
- analysis and implementation of the risk factor;
- reduction or elimination of the risk in order to achieve the desired result;
- taking and controlling risks;
- determining and applying risk management methods;
- collecting information about the risk and its consequences and making
recommendations for the future.
When determining the risk factor, the cause of the risk, that is, the event that
affects the problem, can be identified or implemented.
The goal of risk management is, first of all, risk prevention. The decision-maker
should clearly imagine the consequences of possible adverse events. This will
determine his further actions. The management of the joint-stock company should
develop a risk assessment and strategy for its implementation.
The main task of risk management is to minimize risks to a level appropriate to
the current market situation, to maintain the position of the joint-stock company in the
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lending services market. The main ways of risk management
- increasing risk;
- distributing risk between participants;
- obtaining material security (collateral);
- obtaining security (guarantee or surety);
- transfer risk to higher interest rate loans;
- accept risk into venture lending;
- set aside funds for loan losses; - insurance.
These require the following areas of risk management work:
- continuous monitoring of each client;
- continuous monitoring of the state of the network related to the main economic
activity of a particular client;
- attraction and analysis of guarantees;
- receipt of compensation for the risk (implementation of collateral, guarantees,
etc.).
The stage of risk prevention and control provides for specific organizational and
technical measures based on specific plans and programs. At this stage, the following
measures are implemented: - risk monitoring;
- determination of the risk outlook;
- informing managers about the threats and developing relevant instructions;
- special organizational and technical measures within the framework of the risk
prevention and control program.
Many risks can be prevented and controlled. However, there are risks that cannot
be prevented or reduced, that is, they are beyond the influence of project participants.
Since such risks require a lot of money, they are financed by the method of financing.
This means that project participants self-insure, allocate funds for insurance with the
help of an experienced insurer. Insurance contracts contain clauses that provide for the
insurer to take the necessary measures for most types of risks. In addition to project
participants, insurance organizations are also directly involved in risk management.
They implement their own methods and approaches to risk assessment, monitor
the implementation of these plans and programs.
Evaluation of results is a summary of risk management activities within a specific
project. It is carried out on the basis of a wide range of data and is carried out in order
to make adjustments to the risk analysis, assess the effectiveness of the use of
individual risk management measures, and evaluate all costs incurred in risk
management. The guidelines and conclusions obtained by evaluating the results are
used in the implementation of subsequent projects.
Mathematical models for assessing the impact of risks.
The level of stability of the project can be expressed in terms of the highest level
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of production, price and product value in relation to possible changes in the conditions
of its implementation.
Risk reduction is the reduction of losses by creating reserves to cover unforeseen
expenses. The main problem in creating reserves to cover unforeseen expenses is the
assessment of the serious consequences of risks. For this, it is necessary to take into
account the initial assessment of the project cost. This will greatly help in determining
the amount of the reserve.
When choosing a specific means of risk reduction, it is advisable for the investor
to be guided by the following principles:
- do not take too much risk;
- think about the consequences of the risk; - do not take risks for little.
The following are methods of risk distribution in project financing: guarantees;
- forward purchase agreement;
- production payments;
- hedging, insurance and swaps.
Several methods are used to eliminate or mitigate the impact of specific risks in
the implementation of investment projects.
2) risk avoidance - means abandoning risk-related activities (and therefore, giving
up profit).
3) risk retention - leaving the investor with the risk, while directing his capital to
risky activities, he must have funds to cover the losses from risks.
4) risk transfer (insurance) - the investor transfers the risk of risk to someone else.
Risk insurance, logically speaking, means transferring certain risks to insurance
companies. Its essence is reflected in the investor's refusal to part with his income in
order to get rid of the risk. In this case, it can be understood that the investor is ready
to make a payment to reduce the risk level to "zero". In most cases, insurance
companies provide financial risk insurance to fully reduce the level of risk.
Investment risks and methods of reducing them Methods of reducing investment
risks include:
1) diversification of risks;
2) insurance of risks;
3) distribution of risks among project participants; 4) allocation of financial
reserves for risks.
5) access to additional data and information.
Risk diversification is the distribution of risks between different activities that are
not related to each other. Diversification allows you to get rid of part of the risk by
distributing investments between different activities (investment portfolio) lin
formation).
There are the following forms of risk distribution in the formation of an
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investment portfolio:
1) diversification by goods and services, types of activities;
2) diversification of consumers;
3) diversification of suppliers of goods; 4) diversification of project participants.
The distribution of risks between project participants is carried out during the
development of the financial plan and contractual documents. Risks can be divided
qualitatively and quantitatively. When dividing risks qualitatively, project participants
make decisions by increasing or decreasing one or another risk that belongs to them.
However, the higher the risk distribution to investors, for example, the more difficult
it is to attract them to the project.
There are several methods for determining the risk of an investment project and
the probability of losses associated with it.
1) The objective method is the accuracy of the losses that are likely to occur in
the project and their time interval.
Determining this interval helps to reduce the level of risk.
The loss margin is determined by the following formula:
Here, Y is the loss margin level;
YX is the number of cases leading to losses;
S is the total number of cases being statistically analyzed.
Problem 1: Suppose that out of 200 cases of invested funds, 80 cases result in a
loss of 25 thousand soums. In this case, the loss margin level is (80:200)=0.4. The loss
margin level and the associated risk level for the investment project may be very high,
that is, the loss margin level will be in the range O<Y<1.
2) Subjective method, in which data on all criteria in the investment project should
be analyzed. This method is based on the level of qualifications of experts and financial
consultants who analyze risks. This method is based on assessing the probability of
possible losses using two criteria:
a) the expected average value;
b) the variability of the probable outcome.
The concept of the expected average value is associated with the uncertainty of
the situation under the project and is the average value of all possible outcomes.
If the probable outcomes of an investment project have values x1 and xn, and the
probability of each of them is p1 and pn, then the expected average value is:
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