This is the formula used during the Qualitative Risk Analysis process to determine whether a risk is High, Medium, or Low priority. The Risk Score of a risk is severity times probability. The risk matrix is an important tool for the project team because it helps establish common definitions for risk severity and probability.
Project managers try to mitigate negative risks, or threats, and enhance positive risks, or opportunities. A risk is an uncertain event that will impact the project. A Risk Matrix is a 2D matrix that calculates the risk score for a given risk.
