Risk Management
This kind of risk can be managed using appropriate financial instruments whose price depends on the volatility of a given financial asset (a stock, a commodity, an interest rate, etc.). Examples are Futures contracts such as ViX for equities, or caps, floors and swaptions for interest rates.
Read more about this topic: Volatility Risk
Famous quotes containing the words risk and/or management:
“If you think it will only add one sprig to the wreath the country twines to bind the brows of my hero, I will run the risk of being sneered at by those who criticize female productions of all kinds. ...Though a female, I was born a patriot.”
—Annie Boudinot Stockton (1736–1801)
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