Close Navigation
.

Return Period

Trading Term

A return period is the average interval between events of at least a given severity, and it is the reciprocal of the annual exceedance probability. An event with a 2% annual chance has a 50-year return period, though this describes a long-run average rather than a schedule, and two such events can occur in consecutive years. In catastrophe risk work, return periods are used to label the layers of a reinsurance program and to communicate how rare the losses covered by each layer are expected to be.

Hurricane Forecast Contracts as Efficient Reinsurance

IBKR Campus Newsletters

This website uses cookies to collect usage information in order to offer a better browsing experience. By browsing this site or by clicking on the "ACCEPT COOKIES" button you accept our Cookie Policy.