Do Financial Markets Reward Buying or Selling Insurance and Lottery Tickets? PoorSatisfactoryGoodVery GoodExcellent Be the first. (0 ratings) Log in to rate this article. Financial Analysts Journal September/October 2012 | Vol. 68 | No. 5 | 11 pages Source: CFA InstituteAntti Ilmanen US$0.00 Member | US$0.00 Candidate | US$15.00 Nonmember Read Abstract Selling financial investments with insurance or lottery characteristics should earn positive long-run premiums if investors like positive skewness enough to overpay for these characteristics. The empirical evidence is unambiguous: Selling insurance and selling lottery tickets have delivered positive long-run rewards in a wide range of investment contexts. Conversely, buying financial catastrophe insurance and holding speculative lottery-like investments have delivered poor long-run rewards. Thus, bearing small risks is often well rewarded, bearing large risks not. View more information Topics Behavioral Finance | Derivatives : Options Markets and Instruments | Equity Investments : Equity Market Valuation and Return Analysis | Portfolio Management : Risk Management | Risk Management : Portfolio Risk Management Credits · About the CE Program 0.5 CE (including 0 SER) Record credits Credits recorded Members, log in to record your credits. Manage CE Credits People who viewed this page also viewed: Top Hedge Fund Investors: Stories, Strategies, and Advice This book chronicles top hedge fund investors that played key roles in the industry, including substantial information on manager sourcing, ... More Credit Suisse Global Wealth Report The "Credit Suisse Global Wealth Report" is a comprehensive study of world wealth that analyzes the world’s entire 200 trillion ... More China's 12th Five-Year Plan Alexander Van Kemenade discusses China's 12th five-year plan, which includes higher efficiency in the use of energy, water, and carbon ... More Loading ...