Abstract

The calculation of risk and its pricing has been of great interest to the financial field(s) of economics. As issuance of bonds, loans, mortgages etc. has accelerated so have schemes to bundle, diversify and hedge such 'assets' and with a similarly accelerated 'need' or ever more accurate calculation methods of the risk associated with default, correlation between assets, economic fluctuations of periods of downturns and its converse. With trillions of dollars in such assets outstanding, the 'need' for accuracy is understandable and perhaps mandatory.

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