RISK and RETURNS

[abhishreshthaa]

RELATION BETWEEN RISK AND RETURNS:

• The more risky a project, the higher the expected returns.
  
  
• The Trade-off between Risk & Return can be minimized by breaking the project into three stages.
  
  
• Despite commonality of risk, the spread & intensity vary between different infrastructure projects.
  
  
• The differing risk profile however held to underscore the need of Risk Analysis.

CONCLUSION:

• Risk analysis is an important dimension of infrastructure project that needs to be incorporated.
  
  
• There are cost associated irrespective of ownership.
  
  
• There exist cut-throat competition and which is governed by government regulations.
  
  
• Due to the very nature of these projects i.e. highly Capital intensive there exist a need for Risk Analysis.