Before revision:  In this context , we connect coherent risk measures with the Sharpe ratio from modern portfolio theory and extract the Z-spread - a widely accepted quantity in economics to hedge risk . By involving the Z-spread we demonstrate that risk-averse problems are conceptually equivalent to the risk-neutral problem .
After revision:  In this context , we connect coherent risk measures with the Sharpe ratio from modern portfolio theory and extract the Z-spread - a widely accepted quantity in economics to hedge risk .