Why are VAR limits more advisable than limits based on notional amount, on sensitivity, and on leverage?
Question:
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 62% (8 reviews)
The notional provides a poor measure of market risk a...View the full answer
Answered By
Mugdha Sisodiya
My self Mugdha Sisodiya from Chhattisgarh India. I have completed my Bachelors degree in 2015 and My Master in Commerce degree in 2016. I am having expertise in Management, Cost and Finance Accounts. Further I have completed my Chartered Accountant and working as a Professional.
Since 2012 I am providing home tutions.
3.30+
2+ Reviews
10+ Question Solved
Related Book For
Value at Risk The New Benchmark for Managing Financial Risk
ISBN: 978-0071464956
3rd edition
Authors: Philippe Jorion
Question Posted:
Students also viewed these Finance questions
-
Assume you are in charge of developing the strategy for a multinational company selling products in some 50 countries around the world. One of the issues you face is whether to employ a...
-
Assume you are in charge of developing the strategy for a multinational company selling products in some 50 different countries around the world. One of the issues you face is whether to employ a...
-
Suppose that a pension fund imposes strict VAR limits on the active managers. What are the pros and cons of measuring VAR over a short window?
-
Claud Chapperon is a self-employed distributor of wholesale clothing who began trading on 1 July 2012. His summarised accounts for the year to 30 June 2020 are shown below. The figures in brackets...
-
The balance in retained earnings on January 1, 2011, for Ola Smith Inc, was $800,000. During the year, the corporation paid cash dividends of $90,000 and distributed a share dividend of $8,000. In...
-
Income Inequality a. What evidence is presented in the text that income inequality has increased over time in the United States? b. Use supply and demand of educated workers to explain the increase...
-
A turbine rotor is run at the natural frequency of the system. A stroboscope indicates that the maximum displacement of the rotor occurs at an angle \(229^{\circ}\) in the direction of rotation. At...
-
Sweet Sugar Company manufactures three products (white sugar, brown sugar, and powdered sugar) in a continuous production process. Senior management has asked the controller to conduct an...
-
The following are independent errors made by a company that uses the periodic inventory system: a . Goods in transit, purchased on credit and shipped FOB destination, $ 1 0 , 0 0 0 , were included in...
-
Could it be that smoking actually increases survival rates among women? The following data represent the 20-year survival status and smoking status of 1314 English women who participated in a cohort...
-
Explain how settlement risk is a particular category of credit risk.
-
"Financial markets create a lot of risk due to speculation. They can be compared to the Las Vegas casinos." Comment.
-
Rationalize each denominator. Assume that all radicals represent real numbers and that no denominators are 0. 5 m-n
-
What issues are at the core of expatriation and repatriation problems?
-
What are the basic issues involved in recruiting and selecting managers for foreign assignments?
-
What is the basis for expressing the response of a system under periodic excitation as a summation of several harmonic responses?
-
How does the degree of centralization or decentralization affect international staffing?
-
The transient part of the solution arises from a. forcing function b. initial conditions c. bounding conditions
-
Visit the website for the OBIE Awards, which celebrates creative excellence in advertising. Go to the section for current winners and select one of the winning campaigns...
-
Determine the optimal use of Applichem's plant capacity using the Solver in Excel.
-
A gear manufacturer produces gears for a machine. Two processes, casting and forging, are possible for manufacturing, and the parameters of each process are as follows: Assume that the daily demand...
-
The speed of your automobile has a huge effect on fuel consumption. Traveling at 65 miles per hour (mph) instead of 55 mph can consume almost 20% more fuel. As a general rule, for every mile per hour...
-
Suppose that four 85-octane gasoline pumps and three 89-octane gasoline pumps provide as much profit at a local convenience store in five days as three 85-octane pumps and five 89-octane pumps...
-
The following condensed information was reported by Peabody Toys, Incorporated, for 2024 and 2023: Income statement information Net sales Net income Balance sheet information Current assets Property,...
-
A bond with face value of $1,000 has annual coupons, promised coupon rate of 8%, and 5 years to maturity. Investors require an expected return of 5% from this bond. The probability of default is 2%...
-
How does the increasing influence of technology on governance and civic participation affect democratic processes, and what safeguards are necessary to ensure that technology enhances rather than...
Study smarter with the SolutionInn App