With the integration of the financial markets and free mobility of capital, risks also multiplied. With Globalization becoming part and parcel in the 21^st century, integration of the world economies is bound to occur which in turn makes every economy more vulnerable to any disturbance that occurs in any part of the world. For instance the recent occurrence of Sub prime crisis which has shook all the stocks markets of the world and also is the cause for slowdown of the global economy. Sub prime has occurred in USA, which consumes 40 per cent of the world consumption. Housing sector has a weight age of 67 per cent in their economy so any jerk in that sector is bound to shook the world economy. US investment banks have lended $ 3.3 trillion and now they are unable to recover any money from the debtors. Indian stock markets witnessed lower circuits of 10 per cent on January 22, 2008 when the markets plunged into deep red thus eroding lot of wealth of the investors.  Another example is of, when countries adopt floating exchange rates, they have to face risk due to fluctuations in exchange rates. Deregulation of interest rates cause interest risks. Again, securitization has brought with it the risk of default or counter party risk. Apart from it, every asset whether commodity or metal or share or currency is subject to depreciation in its value. It may be due to certain inherent factors external factors like the market condition, Government policy, economic and political conditions prevailing in a country and so on.