uncertainty principle, also called Heisenberg uncertainty principle or indeterminacy principle, statement, articulated (1927) by the German physicist Werner Heisenberg, that the position and the velocity of an object cannot both be measured exactly, at the same time, even in theory.

Definition. Risk refers to decision-making situations under which all potential outcomes and their likelihood of occurrences are known to the decision-maker, and uncertainty refers to situations under which either the outcomes and/or their probabilities of occurrences are unknown to the decision-maker.

In Probabilistic Models there is risk and uncertainty. Probabailistic models incorporate random variables and probability distributions into the model of an event or phenomenon.

Unfortunately, such conditions are far more common than conditions of certainty. Risk: Risk occurs whenever we cannot predict an alternative’s outcome with certainty, but we do have enough information to predict the probability it will lead to the desired state.

A risk is the chance, high or low, that any hazard will actually cause somebody harm. For example, working alone away from your office can be a hazard. The risk of personal danger may be high. Electric cabling is a hazard.

There are many ways to categorize a company’s financial risks. One approach for this is provided by separating financial risk into four broad categories: market risk, credit risk, liquidity risk, and operational risk.

Broadly speaking, there are two main categories of risk: systematic and unsystematic.

Risk and Types of Risks: Widely, risks can be classified into three types: Business Risk, Non-Business Risk, and Financial Risk.

Within these two types, there are certain specific types of risk, which every investor must know.

• Credit Risk (also known as Default Risk)
• Country Risk.
• Political Risk.
• Reinvestment Risk.
• Interest Rate Risk.
• Foreign Exchange Risk.
• Inflationary Risk.
• Market Risk.

Risk classification is the practice of grouping people together according to the risks they present, including similarities in costs for potential losses or damages, how frequently the risks occur, and whether steps are taken to reduce or eliminate the risks.

1. Speculative risk is a risk where both profit and loss are possible. Speculative risks are not normally insurable….TYPES OF RISK.

The Main Types of Business Risk

• Strategic Risk.
• Compliance Risk.
• Operational Risk.
• Financial Risk.
• Reputational Risk.

Insurable Types of Risk There are generally 3 types of risk that can be covered by insurance: personal risk, property risk, and liability risk.

These risks include health; safety; fire; environmental; financial; technological; investment and expansion. The 10 P’s approach considers the positives and negatives of each situation, assessing both the short and the long term risk.