An effective risk management system requires that the risk manager be independent of the derivatives traders.

Name: An effective risk management system requires that the risk manager be independent of the derivatives traders.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Independence ensures that the risk manager can objectively evaluate and control the risks being taken by the derivatives traders. If the risk manager is not independent, there is a risk of a conflict of interest and biased decision-making.

An Effective Risk Management System Requires That the Risk Manager