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Course Description

This course aims to describe the risk management in the financial services industry and explains the various risks that investment managers face when investing their clients’ funds. It offers a comprehensive introduction to the various Risk Metrics and provides a brief explanation of the Sensitivity Analysis tool, as well as it describes in detail the Liquidity Stress Testing as a risk management tool.

This course also analyses in detail the risk management in Undertaking for Collective Investment in Transferable Securities (UCITS) and Alternative Investment Funds (AIFs) and covers among others the identification and measurement of risks, the stress testing as an important risk management tool for asset managers, the Risk Management Function, the liquidity management and in general the risks of various types of AIFs. It also analyses in brief how to best determine what risks to take and how these risks can be managed.

Risk is at the core of the investment management business thus, how advisers choose what risks to take and how they monitor and manage those risks is fundamental to their – and their clients’ – success.

The objective of effective risk management is not to eliminate risk. From the investment perspective, managing risk requires balancing the probability that an investment will go bad against the possibility that it will perform well, taking into account the anticipated potential losses and gains associated with the investment, while from an operational perspective, managing risk involves balancing the possibility that something will go wrong, and the likely costs that would be incurred in that event, against the cost of mitigating or eliminating the risk.

Risk management begins with the creation and use of organizational checks and balances and the segregation of functions within the organization as a means of mitigating risk.

Topics covered

The course is split into the following sections:

Section 1: Introduction to Risk Management

  • Introduction
  • Risk Management Goals
  • Types of Risks
  • The Process
  • Organizational Checks and Balances
  • Evaluating New Portfolio Investments
  • Evaluating the Risks of New Investments
  • The Risk Metrics
  • Standard Deviation
  • Beta
  • Tracking Error
  • Downside Risk – Downside Probability
  • Value at Risk (VaR)
  • VaR Portfolios
  • Risk Metrics Pros and Cons
  • Another Tool: Sensitivity Analysis
  • Analysis and Risk Management Combined

Section 2: Risk Management in UCITS

  • What’s a UCITS?
  • UCITS risks
  • UCITS Market Risk
  • Identification and Measurement of Risks
  • Techniques
  • Stress Testing
  • Stress tests as a risk management tool
  • UCITS Risk Principles
  • Organization of Risk Management Policies
  • The Risk Management Function
  • Portfolio and Risk Management
  • Outsourcing
  • Setting Risk Limits
  • Risk Management Effectiveness

Section 3: Risk Management in AIFs

  • Broad Definitions
  • AIFM Directive
  • AIFM Risk Management
  • Liquidity Management
  • Risks Per AIF Type

Section 4: Liquidity Stress Testing (LST)

  • Stress tests as a risk management tool
  • Designing the LST Models
  • Understanding Liquidity Risks
  • Governance Principles
  • Governance and Avoidance of Conflict
  • The LST policy
  • LST Frequency
  • Adapting LSTs
  • LST Scenarios
  • Reverse Stress Testing
  • LST when authorisation is required
  • Liquidation Costs
  • Stress Testing Fund Assets
  • Funds with less liquid assets
  • Stress testing fund liabilities
  • Behavioural Aspects
  • Pure redemption shock
  • Historical Approach
  • VaR vs ER
  • Interaction with NCAs
  • Valuation
  • Delegation

Course Duration

This course may take up to 5 hours to be completed. However, actual study time differs as each learner uses their own training pace.

The course is addressed to:

This course is addressed to all individuals who are involved in risk management in financial services such as:

  • Executive Directors, Non-executive directors, Senior Managers, Risk Managers, Asset Managers, Compliance Officers, Portfolio Managers, Investment Advisors, Dealers and in general employees of investment firms, UCITS and Funds
  • Internal Auditors
  • Consultants
  • Anyone interested to understand risk management in financial services

It is also suitable to professionals pursuing CPD for the renewal of CySEC Certificate (CySEC Basic and CySEC Advance Certificate) or other relevant professional certificates in other jurisdictions.

Training Method

The course is offered fully online using a self-paced approach. The learning units consist of power point presentations and case studies. Learners may start, stop and resume their training at any time.

At the end of each section, participants take a Quiz to complete their learning unit and earn a Certificate of Completion once all quizzes have been passed successfully.

Accreditation and CPD Recognition

The course can be accredited by regulators and other bodies for 5 CPD Units that require CPD training in financial regulation. The course may be also approved for up to 5 CPD Units by institutions that approve general financial and AML training, such as the CISI, ICA and ACAMS.

Eligibility criteria and CPD Units are verified directly by your association or other bodies in which you hold membership.

Registration and Access

To register to this course, click on the Take this course button to pay online and receive your access instantly. If you are purchasing this course on behalf of others, please be advised that you will need to create or use their personal profile before finalizing your payment.

Access to the course is valid for 60 days.

If you wish to receive an invoice instead of paying online, please Contact us by email. Talk to us for our special Corporate Group rates.


With more than 10 years of experience, Nektarios is an expert in the financial services industry, having worked in key roles at investment funds, CIFs and other service providers. His exposure to the industry allowed him to gain knowledge in a variety of vital investment functions.

Complementing his practical knowledge of the industry, Nektarios also holds a number of professional and academic qualifications, including CySEC’s Advance Certification. He is currently employed by an Investment Fund.

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Course Description (click to download)