Advances in Accounting

Running head: ADVANCES IN ACCOUNTING
Advances in Accounting
Name of the Student
Name of the University
Author’s Note

1ADVANCES IN ACCOUNTING
Table of Contents
Introduction..........................................................................................................................3
1.1 Background of the study............................................................................................3
1.2 Research Aim.............................................................................................................3
1.3 Research Objective....................................................................................................3
1.4 Research Question.....................................................................................................3
1.5 Rationale for the research..........................................................................................4
2.0 Literature Review..........................................................................................................4
2.1 Process associated to Risk Management...................................................................4
2.2 Capital Asset Pricing Model......................................................................................4
2.3 Value at Risk (VAR).................................................................................................5
3.0 Research Methodology..................................................................................................5
3.1 Research Approach....................................................................................................5
3.2 Data Collection and Analysis....................................................................................6
3.3 Method of Analysis....................................................................................................6
3.4 Data Analysis.............................................................................................................6
3.5 Planning Horizon.......................................................................................................7
3.6 Ethical Issues.............................................................................................................8
3.7 Validity of Analysis...................................................................................................8
3.8 Limitations of the Research.......................................................................................8
4.0 Conclusion.....................................................................................................................9
References..........................................................................................................................10

2ADVANCES IN ACCOUNTING
Introduction
1.1 Background of the study
The decisions pertaining to investments are generally related to initiate specific actions
which will be able to improve the overall strategic position of any company. This is needed to be
related to the analysis which are needed to be related to the various aspects of the basic changes
which are to be brought in the areas of decision making. The determination of the risk factors is
inferred as per considering the relationship of the technological parameters, cost and time (Buyl,
Boone and Wade 2017).
1.2 Research Aim
The aim of the research is to identify the suitable risk management technique for the
investors in DBS Bank.
1.3 Research Objective
The main objectives of the research are listed as follows:
 Identification of the most suitable portfolio setting and management of the risk of
investors in DBS Bank
 Risk management of investors in DBS Bank by VAR and CPM
1.4 Research Question
The questions for the research are listed as follows:
 What is effectiveness of the risk management with the application of CAPM?
 What is impact of risk management VAR on the investors?

3ADVANCES IN ACCOUNTING
1.5 Rationale for the research
The risk of the investment decision is understood in terms of quantitatively measuring the
anticipated risk associated to the risk of the investors in the shares of DBS Bank. In various ways
the risks are depicted with the identification of the best portfolio setting and also the method to
manage the risks in portfolio which are considered among the investors of the bank.
2.0 Literature Review
2.1 Process associated to Risk Management
The risk management process begins with identifying the potential factors of risk among
the investors. These are significantly ranging in term of sourcing the issues associated with
changes in the return in portfolio of the bank. The implementation of the risk management is
inferred in terms of commencement of the different types of the strategies associated to
definition of risk used with the decision-making factors (Schanzenbach and Sitkoff 2017).
2.2 Capital Asset Pricing Model
The CAPM is set on the model of portfolio designed by Harry Markowitz in 1959. This
particular model is seen to be based on the use “mean-variance of the efficient portfolio”. The
risk management procedure in general inferred with ideal systematic management of the
investor’s risk. The systematic risk is referred as the related investment risks. In case the interest
rate is considerably high then an individual can consider the rate of inflation for resistant factors
(Greenwood, Landier and Thesmar 2015). The CAPM model is also considered with the mean-
variance of two more assumptions which were seen to be added in the assumptions proposed by
Markowitz. The vast degree of practical application is seen to be ideal for the estimation of cost
of capital which is necessary for the evaluation of the effectiveness of managing the portfolio.
The important assumptions for this model as per the investors is seen to be based on attaining the