Risk limit

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[rɪsk ˈlɪmət]

Definition: is a reasonable limitation in the company's activities beyond the scope of which it can not withdraw when performing risky operations. The risk management system (risk management system) is aimed at achieving the necessary balance between profit-making and reduction of losses of entrepreneurial activity and is intended to become an integral part of the organization's management system, i.e. should be integrated into the general policy of the company, its business plans and activities. Only if this condition is met, the application of the risk management system is effective.

Risk limit in a sentence:

  1. An example of risk limit can be a certain amount of potential profit of the company.
  2. Risk limit is necessary to keep the company afloat, even after a crash after taking risky actions.

Synonyms and related words: risk management, risky business, risk insurance