Question: Which one is not true about stress testing and scenario analysis? It determines potential losses related to specific scenario It shows how vulnerable a portfolio

Which one is not true about stress testing and scenario analysis?

  1. It determines potential losses related to specific scenario
  2. It shows how vulnerable a portfolio might be to a variety of extreme events.
  3. Most Stress testing and scenario analysis are dynamic in nature
  4. It complements the use of VaR models

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