- CFA Exams
- CFA Level I Exam
- Topic 9. Portfolio Management
- Learning Module 41. Measuring and Managing Market Risk
- Subject 2. Other Key Risk Measures
CFA Practice Question
Which of the following is not a limitation of VaR?
B. It fails to account for liquidity.
C. It relies largely on historical data.
A. Its reliability can be verified easily.
B. It fails to account for liquidity.
C. It relies largely on historical data.
Correct Answer: A
A describes a benefit of VaR, not a limitation. Both B and C are limitations of VaR.
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