<abstract xmlns="http://www.w3.org/1999/xhtml"><p>Even though in many cases the terms of risk and uncertainty are similar, they have to be delimited to understand the meaning of each, individual, as accurately as possible. The two terms are combined in different situations. No matter how well the risk is managed, uncertainty cannot be removed because all possible situations and interdependencies cannot be taken into account. Thus, a source of risk can be considered uncertainty in itself if it is based on poor quality information about the actual internal or external situation of the company. Also, in my conclusion, traditional financial theory distinguishes between systematic risk and particular risk, which reaches the company’s overall risk. Investors can reduce total risk with the two primary risk management instruments, namely diversification and asset allocation.</p></abstract>

Even though in many cases the terms of risk and uncertainty are similar, they have to be delimited to understand the meaning of each, individual, as accurately as possible. The two terms are combined in different situations. No matter how well the risk is managed, uncertainty cannot be removed because all possible situations and interdependencies cannot be taken into account. Thus, a source of risk can be considered uncertainty in itself if it is based on poor quality information about the actual internal or external situation of the company. Also, in my conclusion, traditional financial theory distinguishes between systematic risk and particular risk, which reaches the company’s overall risk. Investors can reduce total risk with the two primary risk management instruments, namely diversification and asset allocation.

Defining the Concept of Risk Applied in Entrepreneurship. Conceptual Delimitation Risk - Entrepreneurial Uncertainty

European Review Of Applied Sociology

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Even though in many cases the terms of risk and uncertainty are similar, they have to be delimited to understand the meaning of each, individual, as accurately...

Defining the Concept of Risk Applied in Entrepreneurship. Conceptual Delimitation Risk - Entrepreneurial Uncertainty

Publicado en línea: 28 jun 2019

Páginas: 43 - 46

DOI: https://doi.org/10.1515/eras-2019-0004

Palabras clave
entrepreneur, risk, uncertainty, SME’s

© 2019 Tărăbîc Andrei Alexandru, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Defining the Concept of Risk Applied in Entrepreneurship. Conceptual Delimitation Risk - Entrepreneurial Uncertainty

Publicado en línea: 28 jun 2019

Páginas: 43 - 46

DOI: https://doi.org/10.1515/eras-2019-0004

Palabras claveentrepreneur, risk, uncertainty, SME’s

© 2019 Tărăbîc Andrei Alexandru, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Palabras clave
entrepreneur, risk, uncertainty, SME’s