Financial Risk Management: An Elective Online MBA Course

Finance is a rapidly growing sector for business professionals and students often have several choices in the field when selecting electives for their online MBA. Financial risk management is just one of the selections available to students. The course mainly appeals to students who are interested in financial sector employment, but it can also attract students who feel financial components could be a boost for their resume. It is certainly an interesting field of study, but what is financial risk management and how does it tie in with online MBA studies?

An Overview of Financial Risk Management in an Online MBA Program

Financial risk management by definition aims to create economic value by using financial instruments to manage exposure to risk, which is mostly seen as market risk or credit risk. However, there are also many risky markets that businesses often dabble in that include foreign exchange, the liquidity of assets, and inflation risks. It is typical of many risk management components in that students will be required to identify the sources of risk, implement a strategy to measure it, and provide solutions for how to address a risky situation.

The solutions that students generate can be both quantitative and qualitative in terms of what a business could be exposed to. However, in both instances, students will be taught how to “hedge” these risks using financial instruments that measure costly exposures to risk.

Financial risk management is a very appealing component to employers. This is because there are several instances when a business may want to use financial risk management techniques. Basic financial theory dictates that a firm should only take on a project when it increases stock value. This means that risks managers will be able to accordingly assess the risks that certain projects present a firm with, then be able to make conclusive decisions regarding their worth to a firm.

Is Financial Risk Management an Easy Online MBA Component to Pass?

Financial risk management is moderate in its difficulty level. Unlike other financial components, financial risk management rewards students with being able to think more creatively. This is because the role in itself can often require more innovative solutions when assessing risks to a firm. The strategies used to control risk can also be quite creative. However, there are still several inflexible techniques that are required of risk managers, so students shouldn’t approach the topic as something that they will be free to develop their own ideas in.

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