Uncertain Mean-LPMs Model

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review

Abstract

Downside risk is a class of risk measures which focuses on the asymmetry of returns about some target level of return (Harlow 1991). It has gradually attracted more and more attentions since investors are often sensitive to downside losses, relative to upside gains. Moreover, it requires simpler theoretical assumptions to justify its application. In portfolio management, investors always prefer securities with smaller downside risk. In the situation with symmetrically distributed returns, some downside risks are consistent with general risk measures. For example, semivariance is exactly proportional to variance for normal distribution, which implies they are equivalent in measuring risk.

Original languageEnglish
Title of host publicationUncertainty and Operations Research
PublisherSpringer Nature
Pages103-114
Number of pages12
DOIs
StatePublished - 2016

Publication series

NameUncertainty and Operations Research
ISSN (Print)2195-996X
ISSN (Electronic)2195-9978

Keywords

  • Downside Risk Measures
  • Lower Partial Moment (LPMs)
  • Portfolio Optimization
  • Risk-return Efficient Frontier
  • Zigzag Uncertain Variable

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