On s-additive robust representation of convex risk measures for unbounded financial positions in the presence of uncertainty about the market model



The sequential condition (2.1) is closely related with the concepts of double limit relations. For a comprehensive
exposition the reader is referred to [15]. In general one may try to apply double limit relations to the sets A
r from
(2.1) and suitable sets of bounded countably additive set functions on σ(
X).

The main result of this section relies on the following assumption, denoting by B(Ω) the space of all bounded
real-valued mappings on Ω.

(2.2) The sets Br := {X Xb sup |X(ω)r} (r > 0) are closed w.r.t. the topology of pointwise convergence
ωΩ

on B(Ω).

Theorem 2.2 Let either X = Xb or X be a Stonean vector lattice such that lim ρ(-λ(X - n)+) = ρ(0) holds for
n→∞

any nonnegative X X, λ > 0. Furthermore let F denote a vector space of bounded countably additive set functions
on
σ(X) which contains all Dirac measures as well as at least one probability measure P with EP |C = π such that
every X X is integrable w.r.t. any μ F. Additionally, F is supposed to be complete w.r.t. the seminorm ∣∣∣∣F,
defined by ∣∣μ∣∣F := sup{ ʃ X dμ X Xb, sup X(ω)1}. Consider the following statements:
ωΩ

.1 ρ satisfies the nonsequential Fatou property.

.2 ρ has a σ-additive robust representation w.r.t. M1 F.

.3 ρ fulfills the Fatou property.

If (2.2) is valid, then .1 .2 .3, and all statements are equivalent provided that condition (2.1) holds in
addition. In the case that the sets A
r from (2.1) are even relatively compact w.r.t. the weak topology σ(X, F) we
have .
1 .2 .3.

The proof will be performed in section 9.

Remark 2.3 The nonsequential Fatou property is not necessary for a σ-additive representation of risk measures.
Take for example
X the space of all boundend Borel-measurable mappings on R, and define ρ by ρ(X) = -EP [X],
where
P denotes any probability measure which is absolutely convex w.r.t. the Lebesgue-Borel measure on R.
Obviously, on one hand ρ is a convex risk measure w.r.t. the identity on
R, having a trivial σ-additive robust
representation. On the other hand, consider the set I of the cofinite subsets of
R, directed by set inclusion, and the
net
(Xi)iI of all its indicator mappings. It converges pointwise to 0, but unfortunately lim inf ρ(Xi) = -1 < 0 =
i

ρ(0).

Remark 2.4 Let F be any vector space of bounded countably additive set functions on σ(X) such that each X X
is integrable w.r.t. every μ F, and such that Xb separates points in F. Additionally, F is supposed to be closed
w.r.t. the norm of total variation. Then the sets A
r from (2.1) are relatively σ(X, F)-compact if and only if Xb
may be identified via evaluation mapping with the topological dual of F w.r.t. the norm of total variation (cf. proof
in section 9).



More intriguing information

1. The name is absent
2. The Social Context as a Determinant of Teacher Motivational Strategies in Physical Education
3. Influence of Mucilage Viscosity On The Globule Structure And Stability Of Certain Starch Emulsions
4. Macroeconomic Interdependence in a Two-Country DSGE Model under Diverging Interest-Rate Rules
5. Prevalence of exclusive breastfeeding and its determinants in first 6 months of life: A prospective study
6. Outsourcing, Complementary Innovations and Growth
7. Education and Development: The Issues and the Evidence
8. Convergence in TFP among Italian Regions - Panel Unit Roots with Heterogeneity and Cross Sectional Dependence
9. THE CHANGING STRUCTURE OF AGRICULTURE
10. The name is absent
11. Lumpy Investment, Sectoral Propagation, and Business Cycles
12. Developmental changes in the theta response system: a single sweep analysis
13. The name is absent
14. Evaluating Consumer Usage of Nutritional Labeling: The Influence of Socio-Economic Characteristics
15. Voting by Committees under Constraints
16. Financial Market Volatility and Primary Placements
17. Modelling the health related benefits of environmental policies - a CGE analysis for the eu countries with gem-e3
18. Conditions for learning: partnerships for engaging secondary pupils with contemporary art.
19. Linking Indigenous Social Capital to a Global Economy
20. The name is absent