Fat Tailed Distributions

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Statistical Consequences of Fat Tails

Author : Nassim Nicholas Taleb
Publisher :
ISBN 13 : 9781544508054
Total Pages : pages
Book Rating : 4.5/5 (8 download)

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Book Synopsis Statistical Consequences of Fat Tails by : Nassim Nicholas Taleb

Download or read book Statistical Consequences of Fat Tails written by Nassim Nicholas Taleb and published by . This book was released on 2020-06-30 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The book investigates the misapplication of conventional statistical techniques to fat tailed distributions and looks for remedies, when possible. Switching from thin tailed to fat tailed distributions requires more than "changing the color of the dress." Traditional asymptotics deal mainly with either n=1 or n=∞, and the real world is in between, under the "laws of the medium numbers"-which vary widely across specific distributions. Both the law of large numbers and the generalized central limit mechanisms operate in highly idiosyncratic ways outside the standard Gaussian or Levy-Stable basins of convergence. A few examples: - The sample mean is rarely in line with the population mean, with effect on "naïve empiricism," but can be sometimes be estimated via parametric methods. - The "empirical distribution" is rarely empirical. - Parameter uncertainty has compounding effects on statistical metrics. - Dimension reduction (principal components) fails. - Inequality estimators (Gini or quantile contributions) are not additive and produce wrong results. - Many "biases" found in psychology become entirely rational under more sophisticated probability distributions. - Most of the failures of financial economics, econometrics, and behavioral economics can be attributed to using the wrong distributions. This book, the first volume of the Technical Incerto, weaves a narrative around published journal articles.

Fat-Tailed and Skewed Asset Return Distributions

Author : Svetlozar T. Rachev
Publisher : John Wiley & Sons
ISBN 13 : 0471758906
Total Pages : 385 pages
Book Rating : 4.4/5 (717 download)

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Book Synopsis Fat-Tailed and Skewed Asset Return Distributions by : Svetlozar T. Rachev

Download or read book Fat-Tailed and Skewed Asset Return Distributions written by Svetlozar T. Rachev and published by John Wiley & Sons. This book was released on 2005-09-15 with total page 385 pages. Available in PDF, EPUB and Kindle. Book excerpt: While mainstream financial theories and applications assume that asset returns are normally distributed, overwhelming empirical evidence shows otherwise. Yet many professionals don’t appreciate the highly statistical models that take this empirical evidence into consideration. Fat-Tailed and Skewed Asset Return Distributions examines this dilemma and offers readers a less technical look at how portfolio selection, risk management, and option pricing modeling should and can be undertaken when the assumption of a non-normal distribution for asset returns is violated. Topics covered in this comprehensive book include an extensive discussion of probability distributions, estimating probability distributions, portfolio selection, alternative risk measures, and much more. Fat-Tailed and Skewed Asset Return Distributions provides a bridge between the highly technical theory of statistical distributional analysis, stochastic processes, and econometrics of financial returns and real-world risk management and investments.

Fat-tailed Distributions

Author : Roger M. Cooke
Publisher :
ISBN 13 : 9781119054207
Total Pages : pages
Book Rating : 4.0/5 (542 download)

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Book Synopsis Fat-tailed Distributions by : Roger M. Cooke

Download or read book Fat-tailed Distributions written by Roger M. Cooke and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

The Fundamentals of Heavy Tails

Author : Jayakrishnan Nair
Publisher : Cambridge University Press
ISBN 13 : 1009062964
Total Pages : 266 pages
Book Rating : 4.0/5 (9 download)

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Book Synopsis The Fundamentals of Heavy Tails by : Jayakrishnan Nair

Download or read book The Fundamentals of Heavy Tails written by Jayakrishnan Nair and published by Cambridge University Press. This book was released on 2022-06-09 with total page 266 pages. Available in PDF, EPUB and Kindle. Book excerpt: Heavy tails –extreme events or values more common than expected –emerge everywhere: the economy, natural events, and social and information networks are just a few examples. Yet after decades of progress, they are still treated as mysterious, surprising, and even controversial, primarily because the necessary mathematical models and statistical methods are not widely known. This book, for the first time, provides a rigorous introduction to heavy-tailed distributions accessible to anyone who knows elementary probability. It tackles and tames the zoo of terminology for models and properties, demystifying topics such as the generalized central limit theorem and regular variation. It tracks the natural emergence of heavy-tailed distributions from a wide variety of general processes, building intuition. And it reveals the controversy surrounding heavy tails to be the result of flawed statistics, then equips readers to identify and estimate with confidence. Over 100 exercises complete this engaging package.

The Fat Tail

Author : Ian Bremmer
Publisher : Oxford University Press
ISBN 13 : 0199752885
Total Pages : 274 pages
Book Rating : 4.1/5 (997 download)

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Book Synopsis The Fat Tail by : Ian Bremmer

Download or read book The Fat Tail written by Ian Bremmer and published by Oxford University Press. This book was released on 2010-05-13 with total page 274 pages. Available in PDF, EPUB and Kindle. Book excerpt: As Ian Bremmer and Preston Keat reveal in this innovative book, volatile political events such as the 2008 Georgia-Russia confrontation--and their catastrophic effects on business--happen much more frequently than investors imagine. On the curve that charts both the frequency of these events and the power of their impact, the "tail" of extreme political instability is not reassuringly thin but dangerously fat. Featuring a new Foreward that accounts for the cataclysmic effects of the 2008 financial crisis, The Fat Tail is the first book to both identify the wide range of political risks that global firms face and show investors how to effectively manage them. Written by two of the world's leading figures in political risk management, it reveals that while the world remains exceedingly risky for businesses, it is by no means incomprehensible. Political risk is unpredictable, but it is easier to analyze and manage than most people think. Applying the lessons of world history, Bremmer and Keat survey a vast range of contemporary risky situations, from stable markets like the United States or Japan, where politically driven regulation can still dramatically effect business, to more precarious places like Iran, China, Russia, Turkey, Mexico, and Nigeria, where private property is less secure and energy politics sparks constant volatility. The book sheds light on a wide array of political risks--risks that stem from great power rivalries, terrorist groups, government takeover of private property, weak leaders and internal strife, and even the "black swans" that defy prediction. But more importantly, the authors provide a wealth of unique methods, tools, and concepts to help corporations, money managers, and policy makers understand political risk, showing when and how political risk analysis works--and when it does not. "The Fat Tail delivers practical wisdom on the impact of political risk on firms of every description and valuable advice on how to use it. Ian Bremmer and Preston Keat offer innovative thinking and useful insight that will help business decision-makers find fresh answers to questions they may not yet know they have." --Fareed Zakaria, best-selling author of The Post-American World "Political risk has become increasingly complex, and The Fat Tail provides a truly new way to quantitatively assess it in established and emerging markets. It is essential reading for any CEO with multinational interests." --Randall Stephenson, Chairman, CEO and President, AT&T Inc. "Should be essential reading for anyone involved in international business even--perhaps especially--in places that seem politically stable." --Bill Emmott, former editor-in-chief of The Economist

Fat-Tailed Distributions

Author : Roger M. Cooke
Publisher : John Wiley & Sons
ISBN 13 : 1848217927
Total Pages : 140 pages
Book Rating : 4.8/5 (482 download)

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Book Synopsis Fat-Tailed Distributions by : Roger M. Cooke

Download or read book Fat-Tailed Distributions written by Roger M. Cooke and published by John Wiley & Sons. This book was released on 2014-12-03 with total page 140 pages. Available in PDF, EPUB and Kindle. Book excerpt: This title is written for the numerate nonspecialist, and hopes to serve three purposes. First it gathers mathematical material from diverse but related fields of order statistics, records, extreme value theory, majorization, regular variation and subexponentiality. All of these are relevant for understanding fat tails, but they are not, to our knowledge, brought together in a single source for the target readership. Proofs that give insight are included, but for most fussy calculations the reader is referred to the excellent sources referenced in the text. Multivariate extremes are not treated. This allows us to present material spread over hundreds of pages in specialist texts in twenty pages. Chapter 5 develops new material on heavy tail diagnostics and gives more mathematical detail. Since variances and covariances may not exist for heavy tailed joint distributions, Chapter 6 reviews dependence concepts for certain classes of heavy tailed joint distributions, with a view to regressing heavy tailed variables. Second, it presents a new measure of obesity. The most popular definitions in terms of regular variation and subexponentiality invoke putative properties that hold at infinity, and this complicates any empirical estimate. Each definition captures some but not all of the intuitions associated with tail heaviness. Chapter 5 studies two candidate indices of tail heaviness based on the tendency of the mean excess plot to collapse as data are aggregated. The probability that the largest value is more than twice the second largest has intuitive appeal but its estimator has very poor accuracy. The Obesity index is defined for a positive random variable X as: Ob(X) = P (X1 +X4 > X2 +X3|X1 ≤ X2 ≤ X3 ≤ X4), Xi independent copies of X. For empirical distributions, obesity is defined by bootstrapping. This index reasonably captures intuitions of tail heaviness. Among its properties, if α > 1 then Ob(X) Ob(Xα). However, it does not completely mimic the tail index of regularly varying distributions, or the extreme value index. A Weibull distribution with shape 1/4 is more obese than a Pareto distribution with tail index 1, even though this Pareto has infinite mean and the Weibull’s moments are all finite. Chapter 5 explores properties of the Obesity index. Third and most important, we hope to convince the reader that fat tail phenomena pose real problems; they are really out there and they seriously challenge our usual ways of thinking about historical averages, outliers, trends, regression coefficients and confidence bounds among many other things. Data on flood insurance claims, crop loss claims, hospital discharge bills, precipitation and damages and fatalities from natural catastrophes drive this point home. While most fat tailed distributions are ”bad”, research in fat tails is one distribution whose tail will hopefully get fatter.

Handbook Of Heavy-tailed Distributions In Asset Management And Risk Management

Author : Michele Leonardo Bianchi
Publisher : World Scientific
ISBN 13 : 9813276215
Total Pages : 598 pages
Book Rating : 4.8/5 (132 download)

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Book Synopsis Handbook Of Heavy-tailed Distributions In Asset Management And Risk Management by : Michele Leonardo Bianchi

Download or read book Handbook Of Heavy-tailed Distributions In Asset Management And Risk Management written by Michele Leonardo Bianchi and published by World Scientific. This book was released on 2019-03-08 with total page 598 pages. Available in PDF, EPUB and Kindle. Book excerpt: The study of heavy-tailed distributions allows researchers to represent phenomena that occasionally exhibit very large deviations from the mean. The dynamics underlying these phenomena is an interesting theoretical subject, but the study of their statistical properties is in itself a very useful endeavor from the point of view of managing assets and controlling risk. In this book, the authors are primarily concerned with the statistical properties of heavy-tailed distributions and with the processes that exhibit jumps. A detailed overview with a Matlab implementation of heavy-tailed models applied in asset management and risk managements is presented. The book is not intended as a theoretical treatise on probability or statistics, but as a tool to understand the main concepts regarding heavy-tailed random variables and processes as applied to real-world applications in finance. Accordingly, the authors review approaches and methodologies whose realization will be useful for developing new methods for forecasting of financial variables where extreme events are not treated as anomalies, but as intrinsic parts of the economic process.

Complex Systems in Finance and Econometrics

Author : Robert A. Meyers
Publisher : Springer Science & Business Media
ISBN 13 : 1441977007
Total Pages : 919 pages
Book Rating : 4.4/5 (419 download)

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Book Synopsis Complex Systems in Finance and Econometrics by : Robert A. Meyers

Download or read book Complex Systems in Finance and Econometrics written by Robert A. Meyers and published by Springer Science & Business Media. This book was released on 2010-11-03 with total page 919 pages. Available in PDF, EPUB and Kindle. Book excerpt: Finance, Econometrics and System Dynamics presents an overview of the concepts and tools for analyzing complex systems in a wide range of fields. The text integrates complexity with deterministic equations and concepts from real world examples, and appeals to a broad audience.

Heavy Tails and Copulas

Author : Rustam Ibragimov
Publisher :
ISBN 13 : 9789814689809
Total Pages : 303 pages
Book Rating : 4.6/5 (898 download)

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Book Synopsis Heavy Tails and Copulas by : Rustam Ibragimov

Download or read book Heavy Tails and Copulas written by Rustam Ibragimov and published by . This book was released on 2017 with total page 303 pages. Available in PDF, EPUB and Kindle. Book excerpt: "This book offers a unified approach to the study of crises, large fluctuations, dependence and contagion effects in economics and finance. It covers important topics in statistical modeling and estimation, which combine the notions of copulas and heavy tails — two particularly valuable tools of today's research in economics, finance, econometrics and other fields — in order to provide a new way of thinking about such vital problems as diversification of risk and propagation of crises through financial markets due to contagion phenomena, among others. The aim is to arm today's economists with a toolbox suited for analyzing multivariate data with many outliers and with arbitrary dependence patterns. The methods and topics discussed and used in the book include, in particular, majorization theory, heavy-tailed distributions and copula functions — all applied to study robustness of economic, financial and statistical models, and estimation methods to heavy tails and dependence."--Publisher's website.

Predictive Modeling Applications in Actuarial Science

Author : Edward W. Frees
Publisher : Cambridge University Press
ISBN 13 : 1107029872
Total Pages : 565 pages
Book Rating : 4.1/5 (7 download)

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Book Synopsis Predictive Modeling Applications in Actuarial Science by : Edward W. Frees

Download or read book Predictive Modeling Applications in Actuarial Science written by Edward W. Frees and published by Cambridge University Press. This book was released on 2014-07-28 with total page 565 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book is for actuaries and financial analysts developing their expertise in statistics and who wish to become familiar with concrete examples of predictive modeling.

An Introduction to Heavy-Tailed and Subexponential Distributions

Author : Sergey Foss
Publisher : Springer
ISBN 13 : 9781489988324
Total Pages : 0 pages
Book Rating : 4.9/5 (883 download)

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Book Synopsis An Introduction to Heavy-Tailed and Subexponential Distributions by : Sergey Foss

Download or read book An Introduction to Heavy-Tailed and Subexponential Distributions written by Sergey Foss and published by Springer. This book was released on 2013-05-20 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Heavy-tailed probability distributions are an important component in the modeling of many stochastic systems. They are frequently used to accurately model inputs and outputs of computer and data networks and service facilities such as call centers. They are an essential for describing risk processes in finance and also for insurance premia pricing, and such distributions occur naturally in models of epidemiological spread. The class includes distributions with power law tails such as the Pareto, as well as the lognormal and certain Weibull distributions. One of the highlights of this new edition is that it includes problems at the end of each chapter. Chapter 5 is also updated to include interesting applications to queueing theory, risk, and branching processes. New results are presented in a simple, coherent and systematic way. Graduate students as well as modelers in the fields of finance, insurance, network science and environmental studies will find this book to be an essential reference.

Climate Shock

Author : Gernot Wagner
Publisher : Princeton University Press
ISBN 13 : 1400880769
Total Pages : 269 pages
Book Rating : 4.4/5 (8 download)

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Book Synopsis Climate Shock by : Gernot Wagner

Download or read book Climate Shock written by Gernot Wagner and published by Princeton University Press. This book was released on 2016-04-19 with total page 269 pages. Available in PDF, EPUB and Kindle. Book excerpt: How knowing the extreme risks of climate change can help us prepare for an uncertain future If you had a 10 percent chance of having a fatal car accident, you'd take necessary precautions. If your finances had a 10 percent chance of suffering a severe loss, you'd reevaluate your assets. So if we know the world is warming and there's a 10 percent chance this might eventually lead to a catastrophe beyond anything we could imagine, why aren't we doing more about climate change right now? We insure our lives against an uncertain future—why not our planet? In Climate Shock, Gernot Wagner and Martin Weitzman explore in lively, clear terms the likely repercussions of a hotter planet, drawing on and expanding from work previously unavailable to general audiences. They show that the longer we wait to act, the more likely an extreme event will happen. A city might go underwater. A rogue nation might shoot particles into the Earth's atmosphere, geoengineering cooler temperatures. Zeroing in on the unknown extreme risks that may yet dwarf all else, the authors look at how economic forces that make sensible climate policies difficult to enact, make radical would-be fixes like geoengineering all the more probable. What we know about climate change is alarming enough. What we don't know about the extreme risks could be far more dangerous. Wagner and Weitzman help readers understand that we need to think about climate change in the same way that we think about insurance—as a risk management problem, only here on a global scale. With a new preface addressing recent developments Wagner and Weitzman demonstrate that climate change can and should be dealt with—and what could happen if we don't do so—tackling the defining environmental and public policy issue of our time.

Extreme Events

Author : Malcolm Kemp
Publisher : John Wiley & Sons
ISBN 13 : 1119962870
Total Pages : 337 pages
Book Rating : 4.1/5 (199 download)

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Book Synopsis Extreme Events by : Malcolm Kemp

Download or read book Extreme Events written by Malcolm Kemp and published by John Wiley & Sons. This book was released on 2011-10-04 with total page 337 pages. Available in PDF, EPUB and Kindle. Book excerpt: Taking due account of extreme events when constructing portfolios of assets or liabilities is a key discipline for market professionals. Extreme events are a fact of life in how markets operate. In Extreme Events: Robust Portfolio Construction in the Presence of Fat Tails, leading expert Malcolm Kemp shows readers how to analyse market data to uncover fat-tailed behaviour, how to incorporate expert judgement in the handling of such information, and how to refine portfolio construction methodologies to make portfolios less vulnerable to extreme events or to benefit more from them. This is the only text that combines a comprehensive treatment of modern risk budgeting and portfolio construction techniques with the specific refinements needed for them to handle extreme events. It explains in a logical sequence what constitutes fat-tailed behaviour and why it arises, how we can analyse such behaviour, at aggregate, sector or instrument level, and how we can then take advantage of this analysis. Along the way, it provides a rigorous, comprehensive and clear development of traditional portfolio construction methodologies applicable if fat-tails are absent. It then explains how to refine these methodologies to accommodate real world behaviour. Throughout, the book highlights the importance of expert opinion, showing that even the most data-centric portfolio construction approaches ultimately depend on practitioner assumptions about how the world might behave. The book includes: Key concepts and methods involved in analysing extreme events A comprehensive treatment of mean-variance investing, Bayesian methods, market consistent approaches, risk budgeting, and their application to manager and instrument selection A systematic development of the refinements needed to traditional portfolio construction methodologies to cater for fat-tailed behaviour Latest developments in stress testing and back testing methodologies A strong focus on the practical implementation challenges that can arise at each step in the process and on how to overcome these challenges “Understanding how to model and analyse the risk of extreme events is a crucial part of the risk management process. This book provides a set of techniques that allow practitioners to do this comprehensively.” Paul Sweeting, Professor of Actuarial Science, University of Kent “How can the likeliness of crises affect the construction of portfolios? This question is highly topical in times where we still have to digest the last financial collapse. Malcolm Kemp gives the answer. His book is highly recommended to experts as well as to students in the financial field.” Christoph Krischanitz, President Actuarial Association of Austria, Chairman WG “Market Consistency” of Groupe Consultatif

Introduction to Nonextensive Statistical Mechanics

Author : Constantino Tsallis
Publisher : Springer Nature
ISBN 13 : 3030795691
Total Pages : 575 pages
Book Rating : 4.0/5 (37 download)

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Book Synopsis Introduction to Nonextensive Statistical Mechanics by : Constantino Tsallis

Download or read book Introduction to Nonextensive Statistical Mechanics written by Constantino Tsallis and published by Springer Nature. This book was released on 2023-01-30 with total page 575 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book focuses on nonextensive statistical mechanics, a current generalization of Boltzmann-Gibbs (BG) statistical mechanics. Conceived nearly 150 years ago by Maxwell, Boltzmann and Gibbs, the BG theory, one of the greatest monuments of contemporary physics, exhibits many impressive successes in physics, chemistry, mathematics, and computational sciences. Presently, several thousands of publications by scientists around the world have been dedicated to its nonextensive generalization. A variety of applications have emerged in complex systems and its mathematical grounding is by now well advanced. Since the first edition release thirteen years ago, there has been a vast amount of new results in the field, all of which have been incorporated in this comprehensive second edition. Heavily revised and updated with new sections and figures, the second edition remains the go-to text on the subject. A pedagogical introduction to the BG theory concepts and their generalizations – nonlinear dynamics, extensivity of the nonadditive entropy, global correlations, generalization of the standard CLT’s, complex networks, among others – is presented in this book, as well as a selection of paradigmatic applications in various sciences together with diversified experimental verifications of some of its predictions. Introduction to Nonextensive Statistical Mechanics is suitable for students and researchers with an interest in complex systems and statistical physics.

Fractals, Chaos, Power Laws

Author : Manfred Schroeder
Publisher : Courier Corporation
ISBN 13 : 0486472043
Total Pages : 450 pages
Book Rating : 4.4/5 (864 download)

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Book Synopsis Fractals, Chaos, Power Laws by : Manfred Schroeder

Download or read book Fractals, Chaos, Power Laws written by Manfred Schroeder and published by Courier Corporation. This book was released on 2009-08-21 with total page 450 pages. Available in PDF, EPUB and Kindle. Book excerpt: This fascinating book explores the connections between chaos theory, physics, biology, and mathematics. Its award-winning computer graphics, optical illusions, and games illustrate the concept of self-similarity, a typical property of fractals. The author -- hailed by Publishers Weekly as a modern Lewis Carroll -- conveys memorable insights in the form of puns and puzzles. 1992 edition.

Financial Risk Forecasting

Author : Jon Danielsson
Publisher : John Wiley & Sons
ISBN 13 : 1119977118
Total Pages : 307 pages
Book Rating : 4.1/5 (199 download)

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Book Synopsis Financial Risk Forecasting by : Jon Danielsson

Download or read book Financial Risk Forecasting written by Jon Danielsson and published by John Wiley & Sons. This book was released on 2011-04-20 with total page 307 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial Risk Forecasting is a complete introduction to practical quantitative risk management, with a focus on market risk. Derived from the authors teaching notes and years spent training practitioners in risk management techniques, it brings together the three key disciplines of finance, statistics and modeling (programming), to provide a thorough grounding in risk management techniques. Written by renowned risk expert Jon Danielsson, the book begins with an introduction to financial markets and market prices, volatility clusters, fat tails and nonlinear dependence. It then goes on to present volatility forecasting with both univatiate and multivatiate methods, discussing the various methods used by industry, with a special focus on the GARCH family of models. The evaluation of the quality of forecasts is discussed in detail. Next, the main concepts in risk and models to forecast risk are discussed, especially volatility, value-at-risk and expected shortfall. The focus is both on risk in basic assets such as stocks and foreign exchange, but also calculations of risk in bonds and options, with analytical methods such as delta-normal VaR and duration-normal VaR and Monte Carlo simulation. The book then moves on to the evaluation of risk models with methods like backtesting, followed by a discussion on stress testing. The book concludes by focussing on the forecasting of risk in very large and uncommon events with extreme value theory and considering the underlying assumptions behind almost every risk model in practical use – that risk is exogenous – and what happens when those assumptions are violated. Every method presented brings together theoretical discussion and derivation of key equations and a discussion of issues in practical implementation. Each method is implemented in both MATLAB and R, two of the most commonly used mathematical programming languages for risk forecasting with which the reader can implement the models illustrated in the book. The book includes four appendices. The first introduces basic concepts in statistics and financial time series referred to throughout the book. The second and third introduce R and MATLAB, providing a discussion of the basic implementation of the software packages. And the final looks at the concept of maximum likelihood, especially issues in implementation and testing. The book is accompanied by a website - www.financialriskforecasting.com – which features downloadable code as used in the book.

Real Option Analysis and Climate Change

Author : Benoit Morel
Publisher : Springer
ISBN 13 : 3030120619
Total Pages : 160 pages
Book Rating : 4.0/5 (31 download)

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Book Synopsis Real Option Analysis and Climate Change by : Benoit Morel

Download or read book Real Option Analysis and Climate Change written by Benoit Morel and published by Springer. This book was released on 2019-06-12 with total page 160 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book sets out to reframe the theory of real options so that it can be used to support environmental investments for climate change adaptation and mitigation. Climate change policy often involves making decisions that concern extended time periods, and doing so under considerable uncertainty. By expanding and broadening the framework of real options, this book first introduces readers to new ways of quantifying investment decisions that can much more effectively address the shape and size of the uncertainty than traditional approaches using Net Present Value. In turn, the second part of the book applies this new theoretical framework to climate change policy by presenting a number of examples, and by providing a general perspective on investment decisions related to climate change and how to prioritize them.