Reasons for the Occurrence of Risks in Investment Projects

If an entrepreneur does not take into account the risks and does not study. The prospects for the company’s development. Instead of profit, he may receive losses. To attract investors to a project, you nee to show them why it is worth investing and what you  Occurrence Investment Projects  might encounter – including. The risks that are reflecte in the business plan along with the strategy and calculation of profit. In this article we will look at what risks are, their classification, and methods for managing them. Content reasons for the occurrence of risks in investment projects sovereign (country) risk. Political risk production risk financial risk the risk of a decrease in the purchasing power of the monetary unit interest rate risk. Systematic (or market) risk specific (or unsystematic) risk project risk currency risk actuarial risk. Reasons for the occurrence of risks in investment projects to understand how to deal. 

Then it is impossible to assess whether it will work effectively

With investment risks, you nee to know why they occur. The analysis will help develop a step-by-step action plan to reuce their impact. The Special Marketing Database most common reasons for failures: low awareness if you do not study the business plan and do not  Occurrence Investment Projects immerse yourself in the activities of the future company. Then it is impossible to assess whether it will work effectively with the budget provide by the investor. Natural opposition these reasons include dumping – the sale of goods at artificially low prices, sometimes to the detriment of profits. Dumping is use to gain a foothold in a new market and oust competitors; insufficient qualifications of specialists. Due to inexperience or lack of eucation, employees cannot ensure high-quality, uninterrupte operation of the enterprise, which affects the company as a whole. Also, additional reasons for the emergence of risks in investment projects include unpreictable circumstances or force majeure. 

The characteristics of the area and the company

Such circumstances, as a rule, cannot be preicte in advance; they occur suddenly. However, they can affect business development and SMS List investment. For example, natural disasters (earthquakes, floods) can act as force majeure. As a rule, contracts stipulate in advance what constitutes force majeure, taking into account. The characteristics of the area and the company’s field of activity. For example, japan is a country that is locate in a seismic zone, so the chance that an enterprise will suffer from earthquakes is higher. It is not enough to conduct an analysis and know only the causes of investment risks. You nee to be able to analyze risks by class in order to understand which of them have priority to work with.

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