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History of the Risk Concept and Risk Modeling

What is risk? The answer is far from simple. The definition depends on the context and is highly subjective. A first attempt is to define risk as the possibility of something unexpected occurring. But what could the constituents of those expected and unexpected events be? Again there is no single answer. The field of finance is a symptomatic example where risk is multiform. It is usual to distinguish between market risk, credit risk, liquidity, operational and legal risks.

Author(s) :

Jean-Christophe Meyfredi

Summary :

What is risk? The answer is far from simple. The definition depends on the context and is highly subjective. A first attempt is to define risk as the possibility of something unexpected occurring. But what could the constituents of those expected and unexpected events be? Again there is no single answer. The field of finance is a symptomatic example where risk is multiform. It is usual to distinguish between market risk, credit risk, liquidity, operational and legal risks.

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Type : Working paper
Date : 18/10/2004
Keywords :

Risk