Investment Risk Essays (Examples)
Study Document
Enterprise Risk Management In Wells Fargo During The Pandemic
Enterprise risk Management in Wells Fargo during the Pandemic
Introduction
As Beasley (2020) points out, enterprise risk management (ERM) is especially needed during the COVID 19 pandemic because of the “number of different, but interrelated risk spread all across most organization” (p. 2). COVID 19 is not just a factor that has impacted one business or industry. It has … the banking sector and Wells Fargo specifically because of its role in managing loan products, using interest rates to attract savers, and offering investment advice. “No single risk associated with the COVID-19 pandemic crisis can be managed in isolation,” as Beasley (2020) points out (p.2). This means that from an ERM … in isolation,” as Beasley (2020) points out (p.2). This means that from an ERM perspective the problem has to be approached comprehensively with risk understood at the macro level. This paper will provide 1) a critical analysis, including……
References
References
Beasley, M. (2020). How to Leverage ERM Principles to Better Respond to COVID-19-Related Risks. ERM Professional Insights.
Derysh, I. (2020). Watchdog questions why Wells Fargo reported giving only one large PPP loan to a Black-owned business. Retrieved from https://www.salon.com/2020/07/22/watchdog-questions-why-wells-fargo-reported-giving-only-one-large-ppp-loan-to-a-black-owned-business/
English, C. (2020). Wells Fargo Forced to Cut Its Dividend After Fed Stress Test. Here’s What Other Banks Did. Retrieved from https://www.barrons.com/articles/wells-fargo-forced-to-cut-its-dividend-after-fed-stress-test-51593467664
Hall, J. (2007). Internal Auditing and ERM: Fitting in and Adding Value. Retrieved from https://global.theiia.org/about/about-the-iia/Public Documents/Sawyer_Award_2007.pdf
Kaplan, R. & Mikes, A. (2012). Managing risks: A new framework. Harvard Business Review, 3.
Lewis, M. (2010). The Big Short. NY: W. W. Norton.
Lundqvist, S. (2014). Abandoning Silos for Integration: Implementing Enterprise Risk Management and Risk Governance. Lund University.
Morgenson, G. (2020). More Wells Fargo customers say the bank decided to pause their mortgage payments without asking. Retrieved from https://www.nbcnews.com/business/personal-finance/more-wells-fargo-customers-say-bank-decided-pause-their-mortgage-n1234610
Study Document
Risk Management And Insurance
… The Contingent Deferred Annuity
vii. Survivorship or Reversionary Annuity
Q3
Investors have to account for inflation when projecting the future value of their investment. The Variable Annuity helps investors cope with the effects of inflation on investment portfolios. The underlying theory is that while the value of a dollar will change over time, a diversified investment portfolio will adjust to reflect the prevailing prices of commodities and services in the economy with inflation factored in. Common stocks represent the … the current securities value accumulated by a client by the outstanding number of accumulation units.
Q4
Just like in life insurance, annuities’ earned investment income during the period of accumulation is not taxable. Taxation happens only when the income is disbursed. The disbursed amount is taxed on … only when the income is disbursed. The disbursed amount is taxed on the basis that the payment made is in excess……
References
References
Vaughan, E. J., & Vaughan, T. (2007). Fundamentals of risk and insurance. John Wiley & Sons.
Study Document
Understanding The Factors Affecting The Success Of Credit Risk In
… more with the advancement of globalization. In each regard of their business operations, banks ought to take effective measures in order to diminish risk by pinpointing the prospective causes based on real-world circumstances. Imperatively, the banking sector is deemed to be a significant source of financing for … a significant source of financing for several companies and entrepreneurs. In the past decade, there have been dramatic changes concerning the management of risk in the banking industry. Progressively more financial institutions and managers have augmented the focus on the significance of risk management. In delineation, risk management encompasses the practice of identifying, assessing and listing of risk followed by organized and cost-effective application of resources to curtail, supervise and control the probability and influence of disastrous events or to capitalize … as financial intermediaries within any economic setting and they are key providers of financial credit to both the corporate……
References
References
Bhattarai, Y. R. (2016). Effect of credit risk on the performance of Nepalese commercial banks. NRB Economic Review, 28(1), 41-64.
Das, A. and Ghosh, S. (2007). Determinants of Credit Risk in Indian State-owned Banks: An Empirical Investigation. Economic Issues, 12(2): 48-66.
Derelio?lu, G., & Gürgen, F. (2011). Knowledge discovery using neural approach for SME’s credit risk analysis problem in Turkey. Expert Systems with Applications, 38(8), 9313-9318
Garr, D. K. (2013). Determinants of credit risk in the banking industry of Ghana. Developing Country Studies, 3(11), 64-77.
Gizaw, M., Kebede, M., & Selvaraj, S. (2015). The impact of credit risk on profitability performance of commercial banks in Ethiopia. African Journal of Business Management, 9(2), 59-66.
Johnson, B., & Christensen, L. (2008). Educational research: Quantitative, qualitative, and mixed approaches. New York: Sage.
Kithinji, A. M. (2010). Credit risk management and profitability of commercial banks in Kenya. (Doctoral dissertation, University of Nairobi).
Limam, I. (2001). Measuring technical efficiency of Kuwaiti banks. Kuwait: Arab Planning Institute.
Study Document
Investing Overseas Market Entry Decision Making
… which has extended beyond its Canadian home base to countries throughout the Americas, following Canadian trade patterns.
Financial institutions also have the same risk management motivation that other companies do. Interest rates theoretically reflect financial risk, but some countries have other forms of risk, in particular in the developing world where the development pathway can be somewhat erratic. Strength in one nation can help to offset weakness … pathway can be somewhat erratic. Strength in one nation can help to offset weakness in other, such that a bank can manage its risk much better
All told, international expansion allows any business to do business where its customers do business, but also to build a more … to do business where its customers do business, but also to build a more diversified portfolio, tap into new growth opportunities, and manage risk more effectively. Each international market has its own……
References
References
CE Intelligence. (2019) EU – market entry strategies. CE Intelligence.com. Retrieved December 5, 2019 from http://www.ceintelligence.com/content_manager/contentPages/view/eu-market-entry-strategies
Chapman, K. & Edmond, H. (2010) Mergers/acquisitions and restructuring in the EU chemical industry: Patterns and implications. Regional Studies. Vol. 34 (8) 753-767
Conyon, M., Girma, S., Thompson, S. & Wright, P. (2003) The productivity and wage effects of foreign acquisitions in the United Kingdom. The Journal of Industrial Economics. Vol. 50 (1) 85-102.
EF.com (2019) English proficiency index. EF.com. Retrieved December 5, 2019 from https://www.ef.com/wwen/epi/
Export.gov (2019) European Union – market entry strategy. Export.gov. Retrieved December 5, 2019 from https://www.export.gov/article?id=European-union-Market-Entry-Strategy
Girma, S. (2002) The process of European integration and the determinants of entry by non-EU multinationals in UK manufacturing. DOI:10.1111/1467-9957.00305
Girma, S. (2005) Technology transfer from acquisition FDI and the absorptive capacity of domestic firms: An empirical investigation. Open Economies Review. Vol. 16 (2) 175-187.
Lamson, M. (2016) 5 things you need to know before doing business in Europe. Inc. Magazine. Retrieved December 5, 2019 from https://www.inc.com/melissa-lamson/5-things-you-need-to-know-before-doing-business-in-europe.html
Study Document
Violence Prevention Programs
… certainly one perspective to consider. People who commit acts of violence are not prohibited from thinking that the benefits of crime outweigh the risk. People are cable of reason, even if they reason wrongly in some cases—like when they decide to commit an act of violence. Rational … be done without the participant’s consent. But once consent is given, the help should come in the form of one who knows what risk to look for and what aid can be provided, whether in terms of assisting the family to get on welfare services, or recommending … on welfare services, or recommending counseling for further mental health help if the participants are showing signs of substance abuse or other negative risk.
To assist with the development of these programs, administrators can turn to communities for further funding by using social media campaigns to drum … unknown when a normal society……
References
References
Altafim, E. R. P., & Linhares, M. B. M. (2016). Universal violence and childmaltreatment prevention programs for parents: A systematic review. Psychosocial Intervention, 25(1), 27-38.
Alternative Paths. (2020). Violence prevention. Retrieved from https://www.alternativepaths.org/services/diversion-programs/violence-prevention-program
Farrell, A. D., Meyer, A. L., Kung, E. M., & Sullivan, T. N. (2001). Development and evaluation of school-based violence prevention programs. Journal of clinical child psychology, 30(2), 207-220.
Johnson, D. W., & Johnson, R. T. (1995). Why violence prevention programs don't work--and what does. Educational Leadership, 52(5), 63-68.
Lee, C., & Wong, J. S. (2020). Examining the effects of teen dating violence prevention programs: a systematic review and meta-analysis. Journal of Experimental Criminology, 1-40.
Siegel, L. (2018). Criminology, 7th Ed. Cengage Learning.
Stagg, S. J., & Sheridan, D. (2010). Effectiveness of bullying and violence prevention programs: A systematic review. Aaohn Journal, 58(10), 419-424.
Study Document
Financial Planning
… Set Financial Goals: 6 Simple Steps. InCharge Debt Solution.]
Moreover, these saved up funds from paying off the liabilities can be used for investment purposes where Howe’s can get the returns, helping them with increasing their cash on hand for education, expenditures and so many other options, … themselves off the burden while investing in better opportunities that can save up cost and have a promising rate of return with lesser risk. These returns can be saved up or re-invested with a tax free IRA, again assisting their financial goals.
Through Chris and Dayna, having ……
References
References
Doyle, A. (2019, May 14). How much is the average wage in America. The Balance Careers. Retrieved from https://www.thebalancecareers.com/how-much-is-the-average-raise-in-america-4582795
Solution, I. D. (n.d.). How To Set Financial Goals: 6 Simple Steps. InCharge Debt Solution.
Study Document
Globalization Of Insurance
… the spread of wealth throughout the world. Insurance companies and finance go together as the former depends upon the latter for return on investment (ROI). Part of the problem with the globalization of insurance is that everything has been globalized—right down to investable markets. Since 2008, central … the world have lowered rates to the point that it is impossible for insurance funds to obtain a targeted ROI without investing in risk assets. Likewise, regulatory bodies have gone global as well with organizations like the Common Framework for the Supervision of Internationally Active Insurance Groups … both ends: tighter regulation makes it harder for insurance companies to make money (when regulation is loose, insurance markets tend to thrive—until the risk catches up with the marketplace and the bubble that is blown pops, as it did in 2008 the world over). Governments want increased … pension funds to, yes, insurance……
References
References
Egan, M. (2018). Tax cut triggers $437 billion explosion of stock buybacks. Retrieved from https://money.cnn.com/2018/07/10/investing/stock-buybacks-record-tax-cuts/index.html
Flegm, E. H. (2008). The Need for Reliability in Accounting. Why historical cost is more reliable than fair value. Journal of Accountancy, 205(5), 34.
Healy, P. M., Palepu, K., & Serafeim, G. (2009). Subprime Crisis and Fair-Value Accounting. HBS Case, (109-031).
Laux, C., & Leuz, C. (2010). Did fair-value accounting contribute to the financial crisis?. Journal of economic perspectives, 24(1), 93-118.
Light, L. (2019). More than Half of All Stock Buybacks are Now Financed by Debt. Here’s Why That’s a Problem. Retrieved from https://fortune.com/2019/08/20/stock-buybacks-debt-financed/
Reda, J. (2018). How Stock Buybacks Can Affect Executive Compensation. Retrieved from http://clsbluesky.law.columbia.edu/2018/08/03/how-stock-buybacks-can-affect-executive-compensation/
Young, M. R., (2008). Both sides make good points. Journal of Accountancy, 205(5), 34.
Vaughan, E. J., & Vaughan T. M., (2013). Fundamentals of Risk and Insurance, 11th Edition.
Study Document
Integrated Waveguide Technologies Preparing For A Public Offering
… information signaling effect. Therefore, a dividend distribution is informing the management of the earnings to allocate as dividends and contribute to sharing purchase investment decisions. Dividend distribution policy is informed by multiple factors such as financial flexibility, investment opportunities for the company, tax consideration, contractual and legal restrictions, the volatility of expected future earnings, and flotation costs (Baker & Weigand, 2015).
… ensure investor confidence. Therefore, management faces the tradeoff of adopting a capital budgeting decision to lower dividends and use the resources for new investment, which potentially decreases the stock prices or the undertake borrowing to pay dividends that result in a stock price increase (Travlos et al., … no adverse effect on the stock prices. Modigliani and Miller posit that a firm's value is determined by the basic earning power and its business risk instead of the pattern of income distribution between retained earnings and dividends. The theory is……
References
References
Al-Malkawi, H.-A. N., Rafferty, M., & Pillai, R. (2010). Dividend Policy?: A Review of Literatures and Empirical Evidence. International Bulletin of Business Administration, 5(9), 38–45. https://doi.org/10.12816/0037572
Baker, H. K., & Weigand, R. (2015). Corporate dividend policy revisited. In Managerial Finance (Vol. 41, Issue 2, pp. 126–144). https://doi.org/10.1108/MF-03-2014-0077
Black, F., & Scholes, M. (2010). The effects of dividend yield and dividend policy on common stock prices and returns. In Journal of Financial Economics (Vol. 1, Issue 1, pp. 1–22). https://doi.org/10.1016/0304-405X(74)90006-3
Farre-Mensa, J., Michaely, R., & Schmalz, M. (2014). Payout Policy. Annual Review of Financial Economics, 6, 75–134.
Mohanasundari, M., & Vidhya, P. (2016). Dividend Policy and Its Impact on Firm Value: A Review of Theories and Empirical Evidence. Journal of Management Sciences and Technology, 3(3), 59–69.
Travlos, Trigeorgis, & Vafeas. (2001). No Title. Multinational Finance Journal, 5(2), 87–112.
Study Document
Impact Of Agency Theory
… arisen in the past due to these problems as this relationship is exploited in self-interest. Some have argued that the scandals and agency risk exist primarily due the awareness of this theory which shouldn’t be thought in the first place. This education encourages an agency mindset where … of the principle (Heath). Sometimes pursuing of self-interest can be a misunderstanding as the agent and principle both have different capacity for taking risk, understanding of growth and other factors which sometimes misguide the principle about the agent creating conflicts on critical decision making of the firm.
… has certain factors and ways of performance, it gives room for agency theory to impact its decision. It impacts the profitability, return on investment, operating expense, shareholder value and other financial performance through influencing the key decision making that goes around these factors. Wells Fargo have a … as the principle as to……
References
References
Demsetz, R. S. (1997). Agency Problems and Risk Taking at Banks.
Heath, J. (n.d.). Uses and Abuses of Agency Theory. Business Ethics Quarterly.
Kuypers, A. (2011). How is dealt with the agency problem and what is the role of the board of directors in it?
Lumen. (n.d.). Agency and Conflicts of Interests. Lumen. Retrieved from https://courses.lumenlearning.com/boundless-finance/chapter/agency-and-conflicts-of-interest/
Murray, I. (2016, September ). Wells Fargo and the Principle Agent Problem. Competitive Enterprise Institute.
Palia, D. (2007). “Agency Theory in Banking: An Empirical Analysis of Moral Hazard and the Agency Costs of Equity. Banks and Banks System.
Pennsylvania, W. U. (2017, August 08). Wells Fargo: What It Will Take to Clean Up the Mess. Wharton University of Pensylvannia.
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