Work #1:

Actual work where 2 students given their post on this:

Compare and evaluate in 500 words or more qualitative v quantitative risk assessment.  

Use at least three sources. Use the Research Databases available from the Danforth Library not Google. Include at least 3 quotes from your sources enclosed in quotation marks and cited in-line by reference to your reference list.  Example: “words you copied” (citation) These quotes should be one full sentence not altered or paraphrased. Cite your sources using APA format. Use the quotes in your paragaphs.   Stand alone quotes will not count toward the 3 required quotes.Copying without attribution or the use of spinbot or other word substitution software will result in a grade of 0. 

Write in essay format not in bulleted, numbered or other list format. 

Reply to two classmates’ posting in a paragraph of at least five sentences by asking questions, reflecting on your own experience, challenging assumptions, pointing out something new you learned, offering suggestions. These peer responses are not ‘attaboys’.   

It is important that you use your own words, that you cite your sources, that you comply with the instructions regarding length of your post and that you reply to two classmates in a substantive way (not ‘nice post’ or the like).  Your goal is to help your colleagues write better. Do not use spinbot or other word replacement software. It usually results in nonsense and is not a good way to learn anything. . I will not spend a lot of my time trying to decipher nonsense. Proof read your work or have it edited. Find something interesting and/or relevant to your work to write about.  

Work #2:

1) Please explain why bond prices are subject to changes in interest rates.   

2) Describe the characteristics of a bond and provide an example of a firm or government entity that has recently issued (sold) these securities.

Please find the two attachments. 


Naren Work:

Qualitative vs. Quantitative Risk Assessment

            Quantitative risk assessment focuses on measurable and predefined data, while a qualitative risk assessment is based on the subject and the knowledge of the analyst. In qualitative risk assessment, the risk is scored based on their likelihood of occurrence and the impact on project objectives if they occur. It generally applies a subjective assessment of risk occurrence probability against potential risk outcomes to determine the severity of a risk. It includes appropriate categorization of the risks, which are source-based, or effect based.  Quantitative risk assessment, on the other hand, is further analysis of high priority risks whereby numerical rating is assigned to develop a probabilistic analysis of a project. It quantifies the potential outcomes for a project and assesses the likelihood of achieving specific objectives. According to Saripalli and Walters (2010), “quantitative risk assessment is a framework for assessing risks associated mostly with cloud computing platforms” (p.280). Moreover, it provides a quantitative approach to decision making in the case of uncertainty and creates achievable cost and scope targets.

            The key difference between qualitative and quantitative risk assessment is their approach to the risk analysis process. Unlike quantitative risk assessment, qualitative risk assessment tends to be more subjective as it focuses on risk identification to measure the probability of a specific risk event occurring during the life cycle of a project. In contrast, quantitative risk assessment tends to be objective as it uses verifiable data to analyze the effects of risk. Quantitative risk assessment relies on string risk models and vast amounts of data, while qualitative risk assessment can be performed at any phase of the project.

Unlike qualitative risk assessment approach, quantitative risks assessment often articulates risks in numerical terms. In contrast, “qualitative approach has no numerical value and is usually opinion based” (Yazar, 2002, p.4). Moreover, while a qualitative risk assessment is used to evaluate individual risks; quantitative risk assessment is used to evaluate project risks. However, both qualitative and quantitative risk assessment models have uncertainty numbers and values. Another similarity between the two is that they all aim at identifying hazards. Both qualitative and quantitative risk assessment approaches often.

There have been numerous arguments on which of these risks approaches is better for project risks management. By ranking the severity of risk on a broader perspective, qualitative risk assessment is the best for gauging probability and prioritizing risk more efficiently. Moreover, qualitative risk assessment makes it easier to identify specific areas that require special intention such as risk events that have high p

Vijay Work

Change of Bond prices due to Change in interest rates

Bonds would essentially compete with the other income interests made on the interest rates by the investor providers. If the interest is grown-up usually, then the income rates would also increase gradually, which makes the providers get more income for the investors. But when the situation occurs with bonds are going down gradually at that times there results in declining the interest rates, then automatically the bond prices would rise gradually according to the situation, as the part of it the rise in the demand makes the increase in the market price for all the bonds, that is as the bonds are of higher demand then the bonds sellers would price their rates to the higher levels in terms of face values. But the principle we have is that the bond rates and the interest prices go automatically opposite each other they do not pose equal reactions among them. This kind of concept or phenomenon is called the interest rate of risks (Dor & Xu, 2015).

A bond is a fixed income investment on which all the investors make various loans. The government bonds are issued by the investments made on the premises if the government; for instance, the government makes a 10years bond of 5% on the coupons for the amount of $10,000. As per the bond for every year, they pay an interest of 5% to your amount of $10,000. But when you want your money returned after the maturity is completed, then the same amount as what you have invested will. Come back, that is $10,000. Some of the characteristics of bonds include all the maturity, coupon rate, tax status, and the Callability. Whereas through the bonds, there include different kinds of risks which are associated with them. Some of those are rate risk, credit or debit risks, and the prepayment risks (Major, 2019).

References

Dor, A., & Xu, Z. (2015). Should Equity Investors Care about Corporate Bond Prices? Using Bond Prices to Construct Equity Momentum Strategies. The Journal Of Portfolio Management, 41(4), 35-49. https://doi.org/10.3905/jpm.2015.41.4.035

Major, J. (2019). Methodological Considerations in the Statistical Modeling of Catastrophe Bond Prices. Risk Management And Insurance Review, 22(1), 39-56. https://doi.org/10.1111/rmir.12114

Sravani Work:

Bond Prices vs Interest Rates

Bond Prices and Interest Rates are inversely proportional i.e. if interest rate decreases then bond price goes up and vice versa. Simple reason supporting the statement is most bonds pay a fixed interest rate that becomes more attractive if interest rates fall as there will be more investor demand that will drive up the price of the bond (Lioudis, 2020). Bonds tends to possess less risk when compared to stocks because bond issuer has a promise to repay bonds. Most of the experienced investors tend to possess both stocks and bonds in ri