100 + Years of Financial Risk Measurement and Management ∗

I selectively survey several key strands of literature on financial risk measurement and management. I begin by showing why the need for financial risk measurement and management exists, and then I turn to relevant aspects of return distributions and volatility fluctuations, with implicit emphasis on market risk for equities. I then treat market risk for bonds, focusing on the yield curve, with its nuances and special structure. In addition to market risk measurement and management, I also discuss aspects of measuring credit risk, operational risk, systemic risk, and underlying business-cycle risk. I nevertheless also stress the limits of statistical analysis, and the associated importance of respecting the unknown and the unknowable.