10-51 Which of the following securities is most unlikely to have a symmetrical return distribution,making the use of JPM RiskMetrics model inappropriate?

Question

Quizplus · Accepted Answer

Option contracts typically have highly skewed distributions, with the possibility of unlimited losses and limited gains. Therefore, the use of an assumption of a symmetrical distribution, as in the JPM RiskMetrics model, would not be appropriate for evaluating the risk of option contracts.

10-51 Which of the Following Securities Is Most Unlikely to Have