This feature allows you to specify a risk tolerance for a particular branch or set of branches in the decision tree. (NOTE: This feature is only necessary for certain models. Most models only require one risk tolerance for the whole tree. This feature is only available if the "Risk tolerance and utility functions by branch" option has been selected in the Advanced settings section of Decision Tree | Model | Settings.)
To specify a risk tolerance on an individual branch or set of branches, double-click the branches to open the Branch Definition dialog and select the Risk Tolerance tab.
Using the Built-in Utility Function
In the section labeled "Built-in exponential utility function", enter the value, variable name, or expression for the risk tolerance coefficient. You must leave the two edit boxes in the section labeled "Custom utility function" blank.
Custom Utility Functions
In the section labeled "Custom Utility function", you will need to enter two expressions. Next to "To utiles", enter the expression for converting the objective function units to utiles (the utility function). Next to "From utiles", enter the expression for converting utiles to the units of the objective function (the inverse of the utility function).
Versions: DPL Professional, DPL Enterprise, DPL Portfolio
See Also