Vulnerabilities in financial markets, economics, the insurance industry, and the environment have become more and more severe. Rare events such as market crashes, earthquakes, hurricanes, and pandemics often lead to considerable losses to society. For monitoring natural disasters and forecasting epidemics, financial institutions and governmental organizations must invest in risk intelligence to clearly define, understand, measure, quantify, and manage their tolerance for and exposure to risk. By developing and using sound analytics to measure, quantify, and forecast risk, business leaders and regulators can rely less on intuition and more on systematic methodologies to manage risk well, evaluate its impact accurately, and make sound policy decisions.
Dr. Peng's lab uses an extensive simulation study to confirm the soundness of the developed analytical toolbox for applied researchers, regulators, and practitioners to conduct risk assessment and management in economics, finance, insurance, and the environment.