CFA Practice Question

There are 155 practice questions for this study session.

CFA Practice Question

It is difficult to model ______ in scenario analysis.
A. discrete risks
B. sequential risks
C. correlated risks
Explanation: Scenario analysis is better suited to assess concurrent risks.

User Contributed Comments 2

User Comment
chriswwu This hits my blind spot. Can someone explain why? I think I can easily define scenarios that depicts sequential risk. Why is it difficult?
Thanks ahead.
DevanCFA Scenario analysis - discrete, concurrent, correlated risk
Decision Trees - discrete, sequential, independant risk
Simulations - continuous, concurrent/sequential, correlated/independant risk
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