Downside Risk

As a downside risk , even downside risk linked refers to the financial risk of loss, ie the difference between the actual and the expected cash return (when the real return is lower), and the uncertainty this reflux. In finance , the risk of a loss of interest income by fixing an interest rate is called downside risk. A loss results from the fact that the market interest rate rises and the fixed interest rate cannot be adjusted. Typically, the risk measure only takes into account the downside risk and not the upside risk value.

history

In the early 1980s, Dr. Frank Sortino the formal definition of downside risk as a better measure of investment risk.

Web links

• http://www.finanz-lexikon.de/downside%20risk_2246.html

Individual evidence

1. ↑ McNeil, Alexander J .; Frey, Rüdiger; Embrechts, Paul (2005). Quantitative risk management: concepts, techniques and tools. Princeton University Press. pp. 2-3. ISBN 978-0-691-12255-7
2. ↑ Nawrocki, David. "A Brief History of Downside Risk Measures". CiteSeerX: 10.1.1.22.262