Risk and return
You'll learn how an organisation's risk appetite shapes its financing and investment decisions, and why different financial instruments offer different levels of risk and return.
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In this lesson
- 0:00 Risk and return fundamentals
- 0:27 How risk appetite shapes financing choices
- 1:22 Debt versus equity risk comparison
- 2:07 Capital and money market instruments
About this lesson
This session explores the fundamental principle that higher risk demands higher potential returns, explains why debt typically carries less risk than equity for investors, and introduces the range of capital market and money market instruments available. Understanding this relationship is essential for FM and AFM papers, where you'll need to advise on appropriate financing structures and investment choices based on organisational strategy and risk tolerance.
Duration: 3m
Transcript
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