The Risk Management of Minimum Return Guarantees

Contracts paying a guaranteed minimum rate of return and a fraction of a positive excess rate, which is specified relative to a benchmark portfolio, are closely related to unit-linked life-insurance products and can be considered as alternatives to direct investment in the underlying benchmark. They contain an embedded power option, and the key issue is the tractable and realistic hedging of this option, in order to rigorously justify valuation by arbitrage arguments and prevent the guarantees from becoming uncontrollable liabilities to the issuer. We show how to determine the contract parameters conservatively and implement robust risk-management strategies.

Youth criminality and urban social conflict in the city of Rosario, Argentina. Analysis and proposals for conflict transformation

The present article describes and analyses youth criminality in the city of Rosario, Argentina between the years 2003-2006. Key actors’ understandings of and responses to the conflict were investigated by means of semi-structured interviews, observations, discourse analysis of policy documents, analysis of secondary data, and draw heavily on the experience of the author, a citizen and youth worker of Rosario. The actors examined were the police, the local government, young delinquents and youth organisations. Youth criminality is analysed from a conflict transformation approach using conflict analysis tools. Whereas, the provincial police understand the issue as a delinquency problem, other actors perceive it as an expression of a wider urban social conflict between those that are “included” and those that are “excluded” and as one of the negative effects of globalisation processes. The results suggest that police responses addressing only direct violence are ineffective, even contributing to increased tensions and polarisation, whereas strategies addressing cultural and structural violence are more suitable for this type of social urban conflict. Finally, recommendations for local youth policy are proposed to facilitate participation and inclusion of youth and as a tool for peaceful conflict transformation.