Seminar by Fikri Karaesmen

Fikri Karaesmen

Financial Hedging of Various Inventory Operations

 Seminar by
Fikri Karaesmen
Koç University
Department of Industrial Engineering



Abstract:Inventory operations involve risk due to uncertain demand and supply conditions, fluctuating prices and other factors. Inventory theory mostly deals with this risk in a risk-neutral framework by focusing on expected cost minimization. However, a joint investment in a financial portfolio of instruments can lead to reductions in other risk measures such as the variance of the profit. We propose formulations and approaches for effectively hedging inventory risks using financial instruments. The inventory models range from a newsvendor with demand and supply uncertainty, to multiple customer class revenue management and finally to dynamic multi-period problems involving both price and demand uncertainty.
This is a joint work with S. Özekici, K. Okyay, F. Sayın, G. Sarı and C. Canyakmaz.


Bio: Fikri Karaesmen is a Professor of Industrial Engineering and the Dean of College of Engineering at Koç University. He has a B.S. degree from METU and a Ph.D. from Northeastern University. His research interests are in stochastic models of inventory and service systems. His papers have appeared in Operations Research, Management Science, Manufacturing and Service Operations Management, IIE Transactions and several other journals.

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