There are various risks which occur in the workplace which require security intervention. Risks take a number of different forms classified under various ways. Some of the risks can not be controlled while others can be minimized. There are different types of risks that can affect investments underlying in macro and micro risk levels. Under macro or large scale classification, there are two main types which include systematic and unsystematic risk (Ortmeier, 2008).
Systematic risk is the type of risk which cannot be reduced in any particular manner and it is always impossible to predict its occurrence. Examples include interest rate changes and the most important way of dealing with this type of risk is to acknowledge the possibility of occurrence then plan for such risks adequately. Unsystematic risk is the class of risk related to specific assets and is usually eliminated through diversification process. Examples in this class of risk include management decision changes, or strikes by employees.
Under micro risk levels there are different types which include business risk; financial, liquidity, market and exchange rate risk (Ortmeier, (2008). Business risk refers to uncertainties related to income which is caused by the nature of the business. This can be eliminated through proper financial management plans to ensure that the business operations are in the right track. To adequately ensure that business risks are dealt with accordingly, it is important for managers to monitor the effectiveness of the risk management approaches.
Another classification of risk lies under liquidity risks which are introduced by secondary market while an entity is trying to meet short term financial obligations. It is commonly experienced in security investment and can be eliminated through application of risk management plan. Market risk is another type of risk which is also referred to as volatility. It mainly applies to stocks and relates to bull and bear market measured through volatility resulting from effect of market forces. This type of risk can be eliminated or mitigated through employment of market risk management strategy.
Ortmeier, P. (2008). Introduction to security: Operations and management (3rd ed.). Upper Saddle River, NJ: Prentice Hall. ISBN: 0135129273