Risk Management
RiskMetrics Group (www.riskmetrics.com) have 9 Rules of Risk Management:

1. There is no return without risk (rewards go to those who take risks)

2. Be transparent (risk should be fully understood)

3. Seek experience (Risk is measured & managed by people, not mathematical models)

4. Know what you don't know (question the assumptions you make)

5. Communicate (risk should be discussed openly)

6. Diversify (multiple risks will produce more consistent rewards)

7. Show discipline (a consistent & rigorous approach will beat a consistently changing strategy)

8. Use common sense (It is better to be approximately right, than to be precisely wrong)

9. Return is only half the equation (decisions should be made only by considering the risk & return of the possibilities)

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