School of Business and Management Department of Finance 202 Risk-Management Duel: Financial vs Operational Risk Management Supervisor: Peter MACKAY / FINA Student: LAI Yuen Ying / ECOF LEUNG Hiu Hin / ECOF LO Hong Yi / FINA XIA Fan / ECOF Course: UROP 1100, Fall UROP 1100, Fall UROP 2100, Fall UROP 1100, Fall Companies often mitigate risk through financial and operational risk management. This project aims to analyse the relation between these risk-management methods, as observed in precious-metal mining companies. At the current stage of the project, the research focuses on operational risk management by studying how companies adjust their production output and production capacity in response to changes in metal prices. We collected mine-level data on mineral reserves, mineral resources, and annual production. Machine-learning and entropy-balancing methods where used to identify which companies, among over one thousand contenders, best complement the existing sample of 34 companies collected as of Summer 2024. This report summarizes of the data collection process in Fall 2024, highlighting specific findings and the challenges encountered for each company. Risk-Management Duel: Financial vs Operational Risk Management Supervisor: Peter MACKAY / FINA Student: LAI Yuen Ying / ECOF LO Hong Yi / FINA WANG Zhengjia / FINA XIA Fan / ECOF Course: UROP 2100, Spring UROP 3100, Spring UROP 1100, Spring UROP 2100, Spring Companies often mitigate risk through financial and operational risk management. This project aims to analyse the relation between these risk-management methods, as observed in precious-metal mining companies. At the current stage of the project, the research focuses on financial risk management by studying how companies adjust their hedging strategies and intensities in response to changes in metal prices. We collected data on hedging-related items, including the scope of selective hedging, use of derivative instruments, hedge accounting, and the scope of their hedging activities concerning commodity prices, foreign exchange, interest rates, and energy costs. This report summarizes of the data collection process in Spring 2025, highlighting specific findings and the challenges encountered for each company.
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