equilibrium economy is considered in which heterogeneous agents face endowment risks. Markets are incomplete: there are only … markets for trading commodities ex-post and hedging price risks ex-ante. I introduce insurance companies supplying individual … insurance contracts against endowment risks and sharing their uncertain profit through stock markets. I show that this restores …

extraction and explanation of the source of term risk. These findings provide: (i) a detailed analysis of the incomplete market … paradigm that encapsulates inter-bank term rates and the risk management processes involved therein; and (ii) theoretical and …

framework while still obtaining Pareto optimality. In the framework developed, the aggregate risk components of individual risks … are exchanged through a highly reduced set of nonspecific securities, while the idiosyncratic risk components are insured …

We examine the impact of risk-based portfolio constraints on asset prices in an exchange economy. Constrained agents … scale down their portfolio and behave locally like power utility investors with risk aversion that depends on current market … conditions. The imposition of constraints dampens fundamental shocks, challenging studies that suggest that risk management rules …

The phenomenal growth of derivative markets across the globe indicates their impact on the global financial scene. As … the securities markets continue to evolve, market participants, investors and regulators are looking at different way in … which the risk management and hedging needs of investors may be effectively met through the derivative instruments. However …

We analyze the possibility of the simultaneous presence of three key features in price-taking credit markets: infinity … the agent's maximization problem and of such credit markets. …

. 1912-1928.<P> This paper formalizes the idea that more hedging instruments may destabilize markets when traders are …