Multiple choice general knowledge

VaR is the minimum amount of money that would be lost in a protfolio with a given probability over a specific period of time.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Value at Risk (VaR) is the MAXIMUM amount of loss expected with a given probability over a specific time horizon, not the minimum. It represents a threshold of potential loss at a confidence level (e.g., 95% or 99%). The statement incorrectly defines VaR as the minimum loss.

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