The value-at-risk method is intended to warn investors about the potential maximum loss that could occur.

Question

Quizplus · Accepted Answer

Value-at-Risk (VaR) is a statistical technique used to measure and quantify the level of financial risk within a firm or investment portfolio over a specific time frame. It estimates the maximum potential loss with a given confidence level, thus warning investors about the potential for significant losses.

The Value-At-Risk Method Is Intended to Warn Investors About the Potential