Amsterdam Institute of Finance
Behavioral Risk Management
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About the course
This program is eligible for 12 CE credit hours as granted by CFA Society VBA Netherlands
Effective risk management involves a combination of quantitative and qualitative skills. Qualitative skills do not substitute, but instead complement and support quantitative skills. The Behavioral Risk Management course presents a framework for managing risks that relate to human psychology. In this regard, virtually every major risk management failure, if not catastrophe, in recent years has had psychological pitfalls at its root.
If you are responsible for risk management or wish to have a better awareness of risks within your organization, if you interact with risk managers, or if you are a risk manager yourself, then this program will help you better understand the psychology of risk. At its core, the psychology of risk pertains to emotions, framing, personality, and judgmental errors. Through this program, you will acquire a vocabulary and skill set for analyzing the psychological dimension of risk management issues, thereby improving your effectiveness and the efficacy of your organization.
How you will benefit
- Learn to identify how psychological hard wiring predisposes people to make systematic mistakes in the assessment and taking of risk
- Be able to assess and describe how risk management culture determines levels of operational risk
- Measure the reflection of sentiment in pricing and its connection to value and risk
- Understand how behavioral frameworks can be used to foster a risk management mindset for all professionals within the organization
- Build a behavioral toolkit through the use of case studies during the program
Psychological foundations: vocabulary, concepts, and techniques
- Framing effects and reference-point risk preferences
- Mitigation approach using nudges, fast and frugal techniques
Financial instability, systemic risk, psychological dimension of global financial crisis
- Financial Instability Hypothesis
- Systemic risk
- Global financial crisis, case studies
- Regulatory heuristics
Risk management in financial firms and regulatory agencies: case studies
- JPMorgan Chase, OCC
- MF Global, CFTC/SEC
- RBS, Fortis, Santander/ABN AMRO, FSA/DNB
- Madoff, SEC
Risk management in operating firms and regulatory agencies: case studies
- Fukushima Daiichi, NISA
- Southwest Airlines, FAA
- BP, MMS
- GM, NHTSA
- Nortel Networks
Who should attend
If you are responsible for risk management or wish to have a better awareness of risks within your organization; if you interact with risk managers, or if you are a risk manager yourself, then this program will help you better understand the psychology of risk.
Trust the experts
Hersh Shefrin is the Mario L. Belotti Professor of Finance at Santa Clara University. He is one of the pioneers in the behavioral approach to economics and finance. The January 2001 issue of CFO magazine listed him among the academic stars of finance. A 2003 article in the American Economic Revie...
Program Profile: Behavioral Risk Management with Hersh Shefrin