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Basic Question 1 of 3
A bank allows its North American business to use 60% of its market risk capital and 40% of its credit risk capital. This is an example of ______.
B. risk limiting
C. risk positioning
A. risk budgeting
B. risk limiting
C. risk positioning
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I was very pleased with your notes and question bank. I especially like the mock exams because it helped to pull everything together.
Martin Rockenfeldt
Learning Outcome Statements
explain constraints used in managing market risks, including risk budgeting, position limits, scenario limits, and stop-loss limits;
explain how risk measures may be used in capital allocation decisions.
CFA® 2024 Level II Curriculum, Volume 5, Module 42.