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risk-adjustment investment

Risk-adjustment investment describes the funds, or capital, specifically identified to pay for the risk that is not transferred to a counterparty or an insurer.

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risk-adjustment investment

Risk-adjustment investment describes the funds, or capital, specifically identified to pay for the risk that is not transferred to a counterparty or an insurer.

Additional Information


Such risk is commonly referred to as a retained risk. The difference between risk-adjusted investment yields and other normal business investments yields is known as the opportunity cost of risk.