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2014/2015  BA-BISHO2002U  Risk Management

English Title
Risk Management

Course information

Language English
Course ECTS 7.5 ECTS
Type Mandatory
Level Bachelor
Duration One Quarter
Course period Second Quarter, Autumn
Timetable Course schedule will be posted at calendar.cbs.dk
Study board
Study Board for BSc in International Shipping and Trade
Course coordinator
  • Nina Lange - Department of Finance (FI)
Main academic disciplines
  • Economics, macro economics and managerial economics
Last updated on 07-01-2015
Learning objectives
At the end of the course, the students must be able to
  • Describe the main sources of risk in the shipping industry
  • Discuss how risk is identified, measured, reported and managed
  • Discuss the role of risk management in value creation
  • Define the financial hedging instruments that are available for shipping firms
  • Discuss and analyze hedging strategies relevant for shipping firm
Risk Management:
Exam ECTS 7,5
Examination form Home assignment - written product
Individual or group exam Group exam, max. 5 students in the group
Group project, max. 5 students in the group
Size of written product Max. 50 pages
Assignment type Project
Duration Written product to be submitted on specified date and time.
Grading scale 7-step scale
Examiner(s) Internal examiner and external examiner
Exam period October and Autumn Term
Make-up exam/re-exam
Another examination form
Re-examination when the regular examination is failed is a 20 minutes individual oral exam based upon the same group project with a 2 pages supplement.

Make-up examination when ill at the oral exam is a 20 minutes individual oral exam based upon the same group project.

Make-up examination when ill during the writing of the project is a 72-hour individual home assignment of max. 10 pages, assessed by one internal examiner.
Course content and structure


The uncertainty involved in ownership and operation of ships has become quite important in recent years as stakes are higher for owners, operators and investors. Agents in the shipping industry face risk from the international and competitive environment in which they operate. Risk emanate from fluctuations in e.g. freight rates, bunker prices, or ship prices as well from the choice of contract during ship operation, finance and credit terms.
The course will start with identifying the main sources of risk relevant for the shipping industry. Measuring of risk through various risk measures, including the commonly used Value-at-Risk, will be introduced and finally, possible hedging instruments including a range of different derivatives are introduced and their use in different hedging strategies will be covered.
The course builds on prerequisites from Maritime Economics, Maritime Law, Statistics and Corporate Finance.
Teaching methods
The course will consist of usual lectures, exercises, and case analyses and discussions. The exercises will integrate Excel as a very useful tool in risk management for example in calculating risk measures and in analyzing different hedging strategies. The cases will illustrate the practical applications of the theory focusing on the shipping industry. It is assumed that students participate actively in the lectures – and especially in these case analyses and discussions.
Expected literature

The curriculum will be uploaded prior to the course on LEARN but will most likely be:

  • Chapters in Alizadeh, Amir H. and Nikos K. Nomikos: Shipping Derivatives and Risk Management, Palgrave Macmillan, 2009.
  • Chapters in Martin Stopford: Maritime Economics, Routledge, 2009
  • Chapters in Philippe Jorion: Value- at Risk, McGraw-Hill, 2007
  • Various research articles (theoretical and empirical)
  • Cases
  • Other readings like newspaper articles and articles for practitioners
Last updated on 07-01-2015