I am not a fan of articles where the authors use widgets and other unrelatable examples to illustrate complex concepts. Here I will illustrate the use of copulas in finance using the example of risk aggregation to drive through the points. First, though, it is important to briefly explain the risk aggregation problem. There are plenty of texts available on the internet which go in great detail about the inner workings of copulas. My goal is to help the reader develop an intuitive understanding of how copulas are used in finance.Read More »