ABSTRACT
We illustrate in this chapter several applications of stochastic dominance in risk management.
After the mean variance (MV) criterion was introduced, it has been widely studied how risk averters and risk seekers apply the MV approach or mean standard deviation (MS) to measure risk based on variables of pro…t. On the other hand, the stochastic dominance (SD) approach to the decision rules for risk averters and risk seekers has also been well investigated.
