Transaction costs in trading involve both risk and return. The return is associated with the cost of immediate … execution and the risk is a result of price movements during a more gradual trading. The paper shows that the trade-off between … risk and return in optimal execution should reflect the same risk preferences as in ordinary investment. The paper develops …

innovations to volatilities are correlated across assets and therefore can be used to measure and hedge geopolitical risk. We … introduce a definition of geopolitical risk which is based on volatility shocks to a wide range of financial market prices. To … measure geopolitical risk, we propose a statistical model for the magnitude of the common volatility shocks. Accordingly, a …

. Specifically, we introduce a measure called CRISK, systemic climate risk, which is the expected capital shortfall of a financial … institution in a climate stress scenario. We use the measure to study the climate-related risk exposure of large global banks in …

Insurance companies can be exposed to climate-related physical risk through their operations and to transition risk … through their $12 trillion of financial asset holdings. We assess the climate risk exposure of property and casualty (P&C) and … life insurance companies in the U.S. We construct a novel physical risk factor by forming a portfolio of P&C insurers …