The Risk Management Way of Goal Setting for Business and Stock Investment

Earlier posts here have covered Environment Scanning and Goal Setting as
the first steps in crafting strategy.

Goals deserve a number of posts because getting them right is far more difficult than people tend to think.

Large corporations spend enormous resources on setting goals, though they may use different genres of jargon for this essential driver of sustained business success.

Retail stock investors can use Goal Setting to improve personal financial planning.

Optimism needs fine balance in stock investing. We cannot buy stocks without some hope for the future. However, who can be certain about the future?

Most stock market transactions may be seen as differences in views about what the future holds. A person sells stock because he or she feels that future returns are less than alternative deployments of the relevant funds. A buyer differs with this view. Perhaps the buyer does not have the alternatives available to the seller.

The overwhelming subjectivity which dominates stock and business appraisal demands some rationalization. Stock decisions are generally taken by small groups rather than by individuals. Grouping may be informal, but that does not mean any lack of influence. Newspapers and business channels on TV have waged relentless wars on investor minds. The Internet magnifies such powers by sheer reach and accessibility.

A risk management orientation to goal setting helps to make investing strategy resilient.

Listing risks is a first step towards setting investment goals. This will be the subject of tomorrow's post.

Here is a link to a useful book on Risk Management:

http://www.amazon.com/exec/obidos/ASIN/0071357319

Please leave a post below on your experiences with and views about risk management. You can also send a private email to

StockWay.MyView@gmail.com

Thank you for your help in bringing your stock investor friends to this web log. Business Management students are also welcome.

Have a profitable stock investing week, and come back here soon.