. Real option theory argues that research projects with conditional phases have option-like risk and return properties, and … portfolio risk, and changes diversification arguments when a portfolio is constructed. When R&D projects exhibit option … are different from unconditional projects. We show that although the risk of a portfolio always depends on the correlation …

technologies under uncertainty. Specifically, given two technologies, one with lower costs at present, but the other with greater … uncertainty in the returns to R&D, how should one allocate the R&D budget? We develop a multi-stage stochastic dynamic programming … variance in the uncertainty in returns to R&D and with the skewness of the uncertainty. We also present an illustrative case …

manage systematic mortality risks, namely self-insurance and risk transfer to purchasers of the annuity products. We … demonstrate that self-insurance leads to high loadings, so that households offered a choice would favor the risk transfer scheme …

This paper studies the pricing of volatility risk using the first-order conditions of a long-term equity investor who …

. Our results apply to stationary and ergodic time series. In a simulation study we show that our asymptotic theory provides …

and risk features than very simple and very complex models. Combinations of two strategies help, in particular, to reduce … risk features like volatility and largest loss, which indicates that complete densities provide useful information for risk. …

extensive number of robustness checks. Overall, downside cash flow risk is priced most consistently across different samples … ability. The downside cash flow risk premium is mainly attributable to small stocks. The risk premium for large stocks appears … much more driven by a compensation for symmetric, cash flow related risk. Finally, we multiply our premia estimates by …

Financial risk management is difficult at the best of times, but especially so in the presence of economic uncertainty … methods have contributed significantly to the analysis of financial risk management when there is economic uncertainty … and financial crises. The purpose of this special issue on "Advances in Financial Risk Management and Economic Policy …