Can someone help me clarify what is meant by contingent claim risk? Question 27 is an example.
My understanding was that a bond had to be callable to have contingent claim risk, however in this example, they are using standard immunization with non-callable bonds, yet the answer says they have contingent claims risk.作者: draz 时间: 2013-4-10 22:50
isn’t contingent claims risk any risk thats dependent on something else happening? Can be call risk or event risk作者: franzino 时间: 2013-4-10 22:50
It is basically a prepayment risk作者: soddy1979 时间: 2013-4-10 22:50
what cfaboston said…for example, life insurance companies have a contingent claims risk due to distermediation.
Best,
TheChad
