DOI: https://doi.org/10.36719/2789-6919/44/132-136
Sayyub Babayev
Azerbaijan Technical University
Master student
https://orcid.org/0009-0008-7994-2311
seyyubbabayev3@icloud.com
Samandar Mammadzadeh
Azerbaijan Technical University
Master student
https://orcid.org/0009-0005-1534-1347
semendermemmedov29@gmail.com
Mirbakhtiyar Sadigov
Azerbaijan Technical University
Master student
https://orcid.org/0009-0003-3175-5633
mirisadygov10@gmail.com
Rufat Hajiyev
Azerbaijan Technical University
Master student
https://orcid.org/0009-0003-2041-4438
haciyevrufat2002@gmail.com
Teymur Chiragov
Azerbaijan Technical University
Master student
https://orcid.org/0009-0009-4334-3058
teymur.ciraqov2002@gmail.com
Strategies for Managing Financial Risk in Projects
Abstract
In modern conditions, the risk factor plays an important role in ensuring the competitiveness of the national economy and economic growth. Significant mitigation of the global economic crisis is possible only on the basis of innovations, increasing the efficiency of production, and adopting new technological and management decisions. A greater share of gross domestic product growth in the economy is ensured by new knowledge expressed in innovative technologies, equipment, the quality of human capital, and the organization of production and management.
The results obtained during the assessment of financial risks serve as an objective justification for how to manage risks, demonstrating the need for how to approach them. That is, should we try to avoid them, or is it more expedient to transfer risks to other organizations or accept them, etc. The attitude to risks allows us to make the most effective choice between three main strategies and various methods of risk management (main and other). Each method has its advantages and disadvantages in relation to various financial risks. The choice of the most appropriate method or methods in each specific situation depends on a large number of factors. The main task of financial risk management is to select management methods and techniques that allow the organization to reduce the probability of risk and losses arising from various variants of its manifestations. Each of the methods is universal, their application does not depend on the characteristics of the field in which the organization operates. The article discusses the main methods of financial risk management-diversification and hedging strategies. Both strategies serve different purposes. This may include the use of fixed-price contracts, performance bonds and insurance policies to transfer certain financial risks to contractors, suppliers or insurers.
Keywords: risk concept, risk identification, risk reduction, investment project, finsnce, project