Breaking Through Risk Management, a Derivative for the Leasing Industry

Sylvain Prado and Ram Ananth ()
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Ram Ananth: CAPCO, Postal: CAPCO | Broadgate West | 9 Appold Street | London A|EC2A 2AP

Journal of Financial Transformation, 2012, vol. 34, 211-218

Abstract: In the leasing industry the lessor faces the risk, at the end of the contract, of not being able to recover sufficient capital value from the resale of the asset. We propose a financial product to hedge residual value risk. Furthermore, we discuss the contribution of the derivative to risk management.

Keywords: Residual Value Risk; Credit Risk; Credit Derivatives; Factor Modeling; Copula (search for similar items in EconPapers)
JEL-codes: C10 G13 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:jofitr:1501

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