Relative risk aversion is defined as R(W)= WA(W); it is increasing if R'(W) > 0, decreasing if R'(W) < 0, and constant if R'(W) = 0. Thus relative risk aversion is increasing if b > 0 (for ), constant if b = 0, and decreasing if b < 0 (for <<).[2] ...
Relative risk is the condition of more or less inherent risk.
Relevance
Relevance is information that is useful or influential for decision-makers. Such information is timely and has predictive value and feedback value.
coefficient of relative risk aversion: This is a measure of the responsiveness to risk implied by a utility function of consumption, for each consumption level. Thus it is an attribute of a model, not an empirical measure usually.
relative risk/volatility A ratio of a portfolio's standard deviation to the standard deviation of a benchmark index. See volatility measures and standard deviation.
In can be hard to see how the relative risks from different sources should affect one's decisions.
A model for describing the way prices of individual assets are determined in an efficient market, based on their relative riskiness in comparison with the return on risk-free assets.
Risk adjusted return on risk adjusted capital (rarorac) combines both raroc and rorac to create an easy yardstick for comparing the relative risks and returns of various activities.
Capital Asset Pricing Model (CAPM) An equation relating an asset's relative riskiness (beta) to its required return. An element of modern portfolio theory.
Typically, managements require an IRR equal to or higher than the cost of capital, depending on relative risk and other factors.
The best way to compute an IRR is by using a spreadsheet (such as Excel) or financial calculator.
Consequently, all uses of the resource must yield an equal rate of return (adjusted for the relative riskiness of each enterprise). Otherwise reallocation would result. George Stigler called this idea the central proposition of economic theory.
Haircuts
Downward adjustments made to the assets held by a brokerage firm in accordance with the relative risk and volatility of those assets. Haircuts are used specifically for the purpose of determining a brokers net capital.
However, its system of judging the relative riskiness of different loans was crude.
The assets of a financial institution multiplied by a weighting established by the regulatory authorities representing the relative risk of these assets.
Finally, there are corporate bonds. These bonds carry more risk but offer more reward. Corporate bonds are rated so you'll have an idea of relative risk, but like stock, even blue chips can go bust.
There are some risks involved... Next Page ...
FLUX - Is the Flow Uncertainty Index. It refers to a financial model developed for the National Association of Insurance Commissioners to quantify the relative risk or variability of CMOs over a range of interest rate scenarios.
analysis of a company's capital structure showing what percentage of the total is debt, preferred stock, common stock, and other equity. The ratio is useful in evaluating the relative risk and leverage that holders of the respective levels of ...
The shape of a yield curve is influenced by a number of factors including the relative riskiness between long-term and short-term securities and by investors' expectations as to the level of future interest rates.
There are a number of credit rating agencies (e.g. Standard & Poor's, Moody's) that review an institution's credit and rate it in terms of relative risk. Institutions receive a rating, referred to as Investment Grades. See Investment Grade.
 See also: Banks, Values, Expense, Saving, Expected return
  
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