Risk Management Quiz

CFA Level III
#1

Simple question: Which probability leads to a more conservative VAR estimate? A) .01 B) .05 C) I’m going to fail this thing

#2

B easy does it abushey settle ur nerves n pull urself together …its def doable easy no but nothing worth having ever is now pull u ur skirt fix ur panties and lets go

#3

A

#4

1% var will be larger, conservative

#5

good gravy goodman is right …lol in that case give me C

#6

A

#7

A, covers more probability, so larger number.

#8

A

#9

A

#10

A - you are going deeper into the tails of the distribution.

#11

Depends on what the question means by conservative. If it means “less extreme” it’s B. If it means from a risk budgeting perspective, then it’s A. But since I’m waffling and over-thinking, I’ll take C.

#12

pimpineasy Wrote: ------------------------------------------------------- > good gravy goodman is right …lol in > that case give me C Great alliteration though. A as well. team_alex Wrote: ------------------------------------------------------- > Depends on what the question means by > conservative. If it means “less extreme” it’s B. > If it means from a risk budgeting perspective, > then it’s A. > > But since I’m waffling and over-thinking, I’ll > take C. A more extreme VAR is considered more conservative.