- CFA Exams
- CFA Level I Exam
- Study Session 19. Portfolio Management (2)
- Reading 55. An Introduction to Risk Management
- Subject 4. Measuring and Modifying Risks

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**CFA Practice Question**

A Value at Risk statistic has these components: ______.

II. the amount of potential maximum loss

III. the probability of that amount of loss

IV. the time frame

I. the amount of potential minimum loss

II. the amount of potential maximum loss

III. the probability of that amount of loss

IV. the time frame

A. I and III

B. II, III and IV

C. I, III and IV

**Explanation:**A VaR statistic has three components: a time period, a confidence level, and a loss amount (or loss percentage).

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