You are a financial specialist, the first one hired for a poolset up to offer insurance to construction companies in your city.The pool you work for takes in approximately $50 to $55 milliondollars in premiums to provide workers compensation insurance forthe members. In the past, the pool has hired a third party that hastaken the money and invested it for the firm, making sure the moneyto pay claims is available, but at the same time making sure themoney is not just sitting in a bank, but invested to providedadditional capital to the pool. The contract with the third partyadministrator will expire in six months. The pool hired you to helpthem better understand the risks their financing activitiesrepresent. The leaders of the pool know that you have to invest themoney to make money, and want the investments to be aggressive, butnot too aggressive, so the pool will have money to pay claims in abad year. They want to understand the balance between too passiveand too aggressive an investment strategy.

Although you need to follow APA in your report, explain theinformation you’d pass on to the pool’s management. Explain whattypes of financial (speculative) risks their organization has.Explain to them countermeasures that can be taken to mitigate oreliminate these threats. Explain what you see as the top fivethreats that the pool faces from a financial risk managementstandpoint.