risk aversion

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Related to Risk averse: Risk neutral

Risk Aversion

The subjective tendency of investors to avoid unnecessary risk. It is subjective because different investors have different definitions of unnecessary. An investor seeking a large return is likely to see more risk as necessary, while one who only wants a small return would find such an investment strategy reckless. However, most rational economic actors are sufficiently risk averse such that, given two investments with the same return and different levels of risk, they would choose the less risky investment.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

risk aversion

The tendency of investors to avoid risky investments. Thus, if two investments offer the same expected yield but have different risk characteristics, investors will choose the one with the lowest variability in returns. If investors are risk averse, higher-risk investments must offer higher expected yields. Otherwise, they will not be competitive with the less risky investments.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

risk aversion

the tendency for managers, consumers and other decision-makers to avoid undertaking risks and to choose less risky alternatives. See RISK PREMIUM.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

risk aversion

the tendency for managers, consumers and other decision makers to avoid undertaking risks and to choose less risky alternatives. See RISK PREMIUM.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
First, in the section "Literature Review: Several Characterizations of the Increasing Convex Order," the increasing convex order, Ross's strongly more risk averse order, and the theory indicating how these two orders can be combined to facilitate comparative statics analysis are reviewed.
So, in this paper, we consider a multiperiod inventory control model in which a risk averse firm faces loss averse customer's uncertain demand and makes an inventory replenishment and pricing decision by maximizing the firm's expected utility.
Ruud Bokhout, marketing director of Trelleborg's engineered products operation, commented, "You could argue that supply chains as a whole are becoming more risk averse because they face many of the same problems across the board, subdued demand, reduced budgets, rising legislation, longer procurement cycles and so on.
is risk averse because the borrowing trend did not show any signs of improvement even after consecutive cuts in SLR rates is incorrect.
Hypothesis 1: Decision makers with a higher level of education will be more risk averse and this will be negatively associated with volatility of returns.
Indeed, some experimental evidence suggests that for some products, the so-called high-profit products, the decision makers are risk averse; see Schweitzer and Cachon [1] for more details.
"The overall market mood is risk averse," prompting the yen-buying, said Shuichi Kanehira, deputy general manager of the foreign exchange division at Mizuho Corporate Bank.
Summary: The Indian rupee hit a fresh lifetime low against the dollar, as risk averse global investors drowned out central bank efforts to stem the currency's slide.
A new Barclays Corporate survey of 300 business leaders nationwide found 43% of respondents said they had shelved plans to invest recently due to current market turmoil, while 66% of corporates expect to see more business failures in their sector and 54% view the private sector as too risk averse. Newcastle respondents weren't quite as downbeat with 24% of businesses saying they had shelved investment plans due to the current economic climate plans.
Cites risk averse mode of banks and lack of developed credit bureaus in the UAE
I examine how the risk preference variables affect the hazard rate into marriage and find that the more risk averse marry sooner, l also exploit sibling data from the NLSY79 to examine the robustness of the empirical results by controlling for unobserved family effects that might be correlated with risk attitudes and find qualitatively similar results.

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