Corpus ID: 30538417

Learning in Rare Risks and Asset Price Implications

  title={Learning in Rare Risks and Asset Price Implications},
  author={Tse-Ling Teh},
The impact of rare risks such as natural disasters, terrorism and epidemics are an increasing force in society. Unlike the case of common risks, our inexperience in rare risks creates di ering views on the level of risk and the optimal form of risk management. Nonetheless, in both cases, the transfer of the nancial risk can play a role in risk management. This paper illustrates how risk class impacts the price of risk transfer. In each risk class, two kinds of risk transfer assets are… Expand

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