Markowitz Efficient Frontier
The Markowitz efficient set is a mathematical concept that depicts the portfolios that produce the highest predicted ...
Translation Risk
Transaction Risk refer to the risk when the cash flow of one currency must be exchanged for a future date to settle a...
Capital Conservation Buffer
The capital conservation buffer (CCB) is meant to protect banks in times of financial distress. It is in keeping with...
Transaction Risk
Transaction Risk refer to the risk when the cash flow of one currency must be exchanged for another at a future date ...
What is Stress Testing?
Stress testing is a type of scenario analysis that looks at a financial outcome based on a specific "stress" placed o...
Bull and Bear Spread
Bull and Bear spread are two common hedging strategies.
Continental Illinois
Continental Illinois was at one time the largest bank in Chicago which aggressively pursued both commercial and indus...
Risk Aggregation
In order to determine the total enterprise risk for a financial institution, all risks must be aggregated and analyzed
What is Potential Future Exposure?
Potential Future Exposure is actually derived from MTM and revaluing the portfolio and considered an estimate of MTM,...
Backtesting VaR
Backtesting attempts to verify whether actual losses are reasonably consistent with projected losses.It compares valu...