Risk lover

(redirected from Risk Lovers)

Risk lover

A person willing to accept lower expected returns on prospects with higher amounts of risk.

Risk Lover

An investor who is willing to take big risks to increase the potential return on investments. For example, a risk lover would be more likely to invest in the IPO of a company with a new and exciting product about which little is known, than to invest in the secured bond issued by a company everyone knows and trusts. Critics maintain that risk lovers accept lower returns for their risk and, as such, are not investing efficiently. See also: Markowitz efficient portfolio.
References in periodicals archive ?
They, thus, propose that risk lovers agents are more likely to evade tax lien, whereas risk adverse subjects are more likely to pay their taxes, even though they may not perceive any tangible benefits from paying.
While this leads us to reject our hypothesis that entrepreneurs would be risk lovers, it is interesting to show that there is not just one type of entrepreneur and that the nature of the entrepreneurs in our sample doesn't fit the previous theory (Kihlstrom & Laffont, 1979) nor the previous empirical findings (Elston et al.
In this sense, those individuals who are risk lovers (or less risk averse), are most likely to be entrepreneurs, just as those who exhibit the joy for winning.
Thus, for example, being risk lover increases the probability of being an entrepreneur in 33 percentage points, while such probability decreases by 37 percentage points when the individual chooses to enter the hypothetical market.
They conclude that for risk averters and risk lovers, prudence guarantees precautionary saving.
This makes the analysis of the precautionary effort relatively more complicated than precautionary saving, since the optimization problem of precautionary saving for risk lovers (see, e.
Crainich, Eeckhoudt, and Trannoy (2013) and Ebert (2013) show that risk lovers can be prudent.
They act as intellectuals and behave as risk lovers.
25 July 2011 - JP Morgan considers that Swedish drug developer Active Biotech AB (STO: ACTI) offers an attractive risk/reward ratio to risk lovers ahead of the results from a second Phase III study of multiple sclerosis (MS) drug candidate laquinimod.
Likewise, risk preferrers or risk lovers would be relatively strong candidates for compensating behavior.
As is illustrated, risk lovers have received more moving violations than the other groups.
Seat belt use is positive and significant for risk lovers (Risk Index of two or less).

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