What Does Shortfall Risk Mean?

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What does Shortfall Risk mean? Read on to discover the definition & meaning of the term Shortfall Risk - to help you better understand the language used in insurance policies.

Shortfall Risk

Shortfall Risk

The probability that a random variable falls below some specified threshold level. (Probability of ruin is a special case of shortfall risk in which the threshold level is the point at which capital is exhausted.)

We hope the you have a better understanding of the meaning of Shortfall Risk.

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