answersLogoWhite

0

it covers the expected loss in situations that go beyond those envisaged in the 99% value at risk estimates used in the VAR ( value at risk margin ) margin .

User Avatar

Wiki User

16y ago

What else can I help you with?

Related Questions

What is a stop loss order used for on the NYSE?

A stop-loss order is a predetermined price at which a trader should sell a stock. With regards to the New York Stock Exchange, a stop-loss order is a price at which the stock should be sold to prevent a catastrophic margin loss to the holder of the stock.


Application requires no data loss and that is time sensitive?

Stock market tickers


What would happen if there was a stock market crash?

A stock market crash is a sudden dramatic decline of stock prices across a significant cross section of a stock market, which results in a significant loss of wealth. Crashes are driven as much by panic as other underlying features.


Did the stock market crash in 1987?

Yes, it was not very noticed but there was 500 billion dollar loss.


What does does buying a stock on margin mean?

Buying on margin means the broker you use will lend you additional money to trade, but they also begin charging interest for the money as soon as you use it. It's a little like a credit card, but you have to pay interest from the moment you use the money. You must fill out an application for a margin account and be approved by the broker. There is a chance too for what's called "a margin call." This can occur if a stock you buy on margin goes down to a point they deem is too low and they'll want you to put more money in the account to help cover the loss. Also, if a trader wants to short stocks they'll need to open a margin account to do so. I have a margin account, but rarely use it unless the general market trend up is very strong or if I want to short. Otherwise, you can really get in a bad way if the stock goes down and you're paying 10% on the original balance too. Trade on! http://stock-trading-warrior.com


What is the meaning of '' mark to market''?

mark to market means capturing the latest price of a stock that might be different in its purchasing price which represents its book value. example lets say you buy 100 stocks of ABC corp at $20 a share on Oct 15 and today oct 22 the stock closed at $25 a share for ABC Corp - this usually represents your mark to market value of your stock - this expresses either as a profit or loss i hope this helps


How did buying on margin work?

Buying on margin allowed investors to borrow money from their broker to purchase stocks. This meant they only had to provide a percentage of the total cost of the stock as collateral, while the broker would lend them the rest. The investor would then pay interest on the borrowed amount. If the stock price increased, the investor could sell the stock and repay the loan with the profits. However, if the stock price decreased, the broker could issue a margin call, requiring the investor to deposit more funds to cover the loss.


Buying stock on margin remained profitable as long as?

stock prices rose


Can you conceive data of an appliacation that requires no data loss and that is also highly time-sensitive?

stock market tickers


Can you check balance of Market Basket gift cards on line?

Buying on margin refers to the practice of using borrowed money to purchase securities, such as stocks. In a bull market, which is a period of rising stock prices, buying on margin can amplify gains for investors because they can purchase more shares with the same amount of money. During a bull market, investors are optimistic about the future performance of the stock market and are more willing to take on debt to invest in stocks. As a result, they may use margin to purchase more shares than they would be able to afford with just their own capital. This can result in higher returns for investors if the stock prices continue to rise, as they are effectively leveraging their own capital. However, buying on margin can also amplify losses during a bear market, which is a period of falling stock prices. If the value of the stocks purchased on margin falls below the value of the borrowed money, the investor may be required to deposit more money or sell the shares to repay the loan. This can exacerbate the losses incurred during the bear market, resulting in a potential financial loss. It is important to note that buying on margin is a high-risk strategy, and investors should be aware of the potential risks and have a solid understanding of their own financial situation before engaging in this type of investment. It's always good to consult with a financial advisor before taking on a margin account. learn more on insta: matthewgillreal


How do you calculate net profit margin if there is net loss?

The Gross Profit Margin = Gross Profit/Revenue*100 regardless of weather the Gross Profit is positive or negative (a loss). Therefor, it is acceptable to have a negative Gross Profit Margin.


What are the potential consequences of a trade bust in the stock market?

A trade bust in the stock market can lead to significant financial losses for investors, increased market volatility, loss of confidence in the market, and potential regulatory scrutiny. It can also impact the overall economy by affecting consumer spending and business investments.