Sentence examples for basis risk from inspiring English sources

Basis risk – where indices measured do not perfectly mirror the experienced loss – remains a key issue.

The possibility of such an unfavourable movement in the basis is known as basis risk.

These experiments revealed important complementarities between formal and informal insurance in the presence of basis risk.

Dalhaus, T. & Finger, R. Can gridded precipitation data and phenological observations reduce basis risk of weather index-based insurance?

Standardisation is a precondition for growth, but it allows basis risk to build.

"Our business is ultimately the management of basis risk," says Goldman Sachs's Mr Chavez.

At the same time they typically have a high level of basis risk.

Our results highlight the importance of designing contracts with minimal basis risk under compound-risk aversion.

Thus hedgers, through their commitment in the futures market, substitute basis risk for the price risk they would have taken in carrying unhedged stocks.

However, the uptake of index insurance remains low, which can be partially attributed to the inherent problem of basis risk.

We analyze basis risk entailed by hedging the guarantee with a dynamic portfolio of proxy assets for the funds.