Explain the term Value at Risk
Explain the term Value at Risk.
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VaR calculations frequently assume that returns are normally distributed in excess of the time horizon of interest. Inputs for a VaR computation will include details of the portfolio composition, parameters and the time horizon governing the distribution of the underlying. The latter set of parameters consists of average growth rate, standard deviations or volatilities and correlations. When the time horizon is short you can avoid the growth rate, as this will only have a small consequence on the last calculation.
What is mathematical definition of risk in form of semi-variance?
What is bird in the hand theory of cash dividends?
Assume you are a euro-based investor who just sold Microsoft shares which you had bought six months ago. You had invested 10,000 euros to purchase Microsoft shares for $120 per share; the exchange rate was $1.15 per euro. You sold the stock for $135 per share
Will the cost of equity be zero if dividends paid to common stockholders will not be legal obligations of a corporation?
Elucidate the factors which affect the choice of a minimum cash balance amount.
What is Kelly Fraction? Explain.
Why is actual volatility not easy to measure?
Explain Central Limit Theorem with an example of random variables.
What are Finite-difference methods?
When you add random numbers and get normal, what occurs when you multiply them?
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