Buy-Side Risk Management
Written by Casey Edward O'Meara   

On Tuesday, November 6th, the masters students were pleased to have Ken Winston lead the program’s weekly seminar. Dr. Winston, who is a fellow instructor of the program, is also the chief risk officer of Morgan Stanley Investment Management. Dr. Winston walked the students through the many challenges facing risk managers in both the buy side and sell side of the industry. These managers are charged with the difficult tasks of foreseeing potential threats to either firm or client capital and deciding how best to deal with them.

Dr. Winston described the various methods and metrics used today in risk management to help assess these threats and to mitigate their potential impact. However, he then added a word of caution noting that these processes often arise in response to events and crises that have occurred at some point in the past. The real challenge, he explained, is in identifying the next potential threat. And as history will show, the next threat is often something unlike anything people have already seen in the past.–CASEY O’MEARA '08