CARA Utility Function

Evaluate Constant Absolute Risk Aversion (CARA) utility function: U(w) = -exp(-Aw)/A where A is the risk aversion coefficient. Returns utility value, marginal utility, absolute risk aversion (constant = A), and relative risk aversion (Aw). CARA exhibits constant absolute risk aversion regardless of wealth level. Use for modeling risk preferences in finance and insurance. [Tier: STANDARD, Credits: 2]

POST /quantlib/economics/utility/cara

CARA Utility Function

cURL

curl --request POST \
  --url https://api.fincept.in/quantlib/economics/utility/cara \
  --header 'Content-Type: application/json' \
  --header 'X-API-Key: <api-key>' \
  --data '
{
  "risk_aversion": 0.01,
  "wealth": 10000
}
'

200

{
  "success": true,
  "data": {
    "utility": -3.72e-44,
    "marginal_utility": 3.72e-46,
    "absolute_risk_aversion": 0.01,
    "relative_risk_aversion": 100
  }
}

Authorizations

X-API-Key · string · header · required

API key for authentication. Get your key at https://api.fincept.in/auth/register

Body

application/json

risk_aversion · number · required

Absolute risk aversion coefficient A (A > 0 for risk aversion)

Example:

0.01

wealth · number · required

Current wealth level

Example:

10000

Response

200

application/json

Successful Response

success · boolean

Example:

true

data · object

Show child attributes