Financial Dictionary

This dictionary contains:
24549
financial terms

Risk lover




Risk lover

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

RELATED TERMS
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Lower
To decrease (a price, tax rate, interest rate, etc.).

Higher
Adjective meaning greater, larger: e.g. higher prices; (cannot be used as a verb, instead use raise).

Risk
The possibility of loss; the amount that one may lose when investing.



SIMILAR TERMS
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Risk
The possibility of loss; the amount that one may lose when investing.

Risk adjusted discount rate
The rate established by adding a expected risk premium to the risk-free rate in order to determine the present value of a risky investment.

Risk adjusted profitability
A probability used to determine a "sure" expected value (sometimes called a certainty equivalent) that would be equivalent to the actual risky expected value.

Risk adjusted return
Return earned on an asset normalized for the amount of risk associated with that asset.

Risk arbitrage
Traditionally, the simultaneous purchase of stock in a company being acquired and the sale of stock of the acquirer. Modern risk arbitrage focuses on capturing the spreads between the market value of an announced takeover target and the eventual price at which the acquirer will buy the target's shares.

Risk averse
Describes an investor who, when faced with two investments with the same expected return but different risks, prefers the one with the lower risk.

Risk based capital ratio
Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset.

Risk classes
Groups of projects that have approximately the same amount of risk.

Risk controlled arbitrage
A self-funding, self-hedged series of transactions that generally use mortgage securities (MBS) as the primary assets.

Risk Equity, SICAV, S.A.
Risk Equity, SICAV, S.A. is a Spanish company listed at Madrid Stock Exchange. Its business activity is capital investment.

Risk factor
In arbitrage pricing theory or the multibeta capital asset pricing model, the set of common factors that impact returns, e.g., market return, interest rates, inflation, or industrial production.

Risk free asset
An asset whose future normal return is known today with certainty.

Risk free interest rate
Describes return available to an investor in a security somehow guaranteed to produce that return. The risk-free interest rate compensates the investor for the temporary sacrifice of consumption.

Risk free rate
The rate earned on a riskless asset.

Risk indexes
Categories of risk used to calculate fundamental beta, including market variability, earnings variability, low valuation, immaturity and smallness, growth orientation, and financial risk.

Risk management
The process of identifying and evaluating risks and selecting and managing techniques to adapt to risk exposures.

Risk neutral
Insensitive to risk.

Risk premium
The reward for holding the risky market portfolio rather than the risk-free asset. The spread between Treasury and non-Treasury bonds of comparable maturity.

Risk premium approach
A common approach for tactical asset allocation to determine the relative valuation of asset classes based on expected returns.

Risk profile
A mapping of the change in value or profits and losses to which an organization has exposure.

Risk prone
Willing to pay money to assume risk from others.

Risk return trade off
The basic concept that higher expected returns accompany greater risk, and vice versa.

Risk reward ratio
Relationship of substantial reward corresponding to the amount of risk taken; mathematically represented by dividing the expected return by the standard deviation.

Risk seeker
Investor who likes to take risk and is even willing to pay for it. Also called risk lover.

Risk tolerance
An investor's ability or willingness to accept declines in the prices of investments while waiting for them to increase in value.

Risk transfer
The shifting of risk through insurance or securitization of debt because of risk aversion.

Riskless arbitrage
The simultaneous purchase and sale of the same asset to yield a profit.

Riskless or risk free asset
An asset whose future return is known today with certainty. The risk-free asset is commonly defined as short-term obligations of the US government.

Riskless rate
The rate earned on a riskless investment, typically the rate earned on the 90-day US Treasury Bill.

Riskless rate of return
The rate earned on a riskless asset.

Riskless transaction
A transaction that is guaranteed a profit, such as the arbitrage of a temporary differential between commodity prices in two different markets.

Risky asset
An asset whose future return is uncertain.



PREVIOUS AND NEXT TERMS
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Risk factor
In arbitrage pricing theory or the multibeta capital asset pricing model, the set of common factors that impact returns, e.g., market return, interest rates, inflation, or industrial production.

Risk free asset
An asset whose future normal return is known today with certainty.

Risk free interest rate
Describes return available to an investor in a security somehow guaranteed to produce that return. The risk-free interest rate compensates the investor for the temporary sacrifice of consumption.

Risk free rate
The rate earned on a riskless asset.

Risk indexes
Categories of risk used to calculate fundamental beta, including market variability, earnings variability, low valuation, immaturity and smallness, growth orientation, and financial risk.

Risk lover

Risk management
The process of identifying and evaluating risks and selecting and managing techniques to adapt to risk exposures.

Risk neutral
Insensitive to risk.

Risk premium
The reward for holding the risky market portfolio rather than the risk-free asset. The spread between Treasury and non-Treasury bonds of comparable maturity.

Risk premium approach
A common approach for tactical asset allocation to determine the relative valuation of asset classes based on expected returns.

Risk profile
A mapping of the change in value or profits and losses to which an organization has exposure.

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This dictionary contains 24549 terms.







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