|
Journal Article
| CFA Institute Conference Proceedings Quarterly
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December 2007
Applying Modern Risk Management to Equity and Credit Analysis
by
Robert C. Merton
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Abstract
Traditional conventions of accounting and actuarial science distort the valuation of capital risk in corporations with pension plans because under these conventions, pension assets and liabilities are not included in balance sheet calculations. The modern risk management tools of derivatives technologies can improve both corporate decision making and external analysis of corporations.
Keywords: Financial Statements;
Decision Making;
Capital;
Credit;
Equity;
Compensation and Benefits;
Risk Management;
Valuation;