Paper Summary:

This paper reviews methods for applying Value-at-Risk (VaR) to risk management by financial institutions. The paper discusses managing risk and return, Monte Carlo simulation, historic simulation and the exponential approach.

From the Paper:

"Financial institutions will never enjoy risk-free operations. Financial institutions can, however, apply procedures in the conduct of their operations that manage risk so that the probability of loss is manageable. There are many approaches to risk management for financial institutions, depending upon the type of risk that requires management. (DeGoede) One approach that financial institutions apply in the management of market risk is Value-at-Risk (VaR). VaR also is useful in the management of interest..."

Visitors who viewed this Term Paper also liked these:

• Business Plan # 26833 : "Risk Management in Financial Institutions"
• Research Paper # 56032 : "Risk Management and Financial Risks"
• Term Paper # 105371 : "Interest Rate Risk Management"

APA Citation:

MLA Citation: