What is the meaning of portfolio at risk?
Portfolio risk is a chance that the combination of assets or units, within the investments that you own, fail to meet financial objectives. Each investment within a portfolio carries its own risk, with higher potential return typically meaning higher risk.
What does portfolio risk mean?
Portfolio at Risk means the outstanding principal amount of all Client Loans that have one or more instalments of principal, interest, penalty interest, fees or any other expected payments past due more than a specified number of days.
What is portfolio at risk ratio?
Portfolio at Risk (PAR) Ratio is calculated by dividing the outstanding balance of all loans with arrears over 30 days, plus all renegotiated (or restructured) loans,3 by the outstanding gross loan portfolio. The data used for this indicator is calculated at a certain date in time.
How do you calculate portfolio risk?
The level of risk in a portfolio is often measured using standard deviation, which is calculated as the square root of the variance. If data points are far away from the mean, the variance is high, and the overall level of risk in the portfolio is high as well.
What are the two types of portfolio risk?
The major types of portfolio risks are: loss of principal risk, sovereign risk and purchasing power or “inflation”risk (i.e. the risk that inflation turns out to be higher than expected resulting in a lower real rate of return on an investor’s portfolio).
What does portfolio risk depend on?
Portfolio risk depends on: Risk of individual assets. Weight of each asset. Covariance or correlation between the assets.
What a portfolio is?
What Is a Portfolio? A portfolio is a collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, including closed-end funds and exchange traded funds (ETFs). People generally believe that stocks, bonds, and cash comprise the core of a portfolio.
How do you calculate portfolio risk in Excel?
Quote from Youtube:
So the variance for a portfolio is equal to the percentage you put in a squared. Times the variance of a plus the percentage you put in b. Squared times the variance of b.
How is par calculated?
Par is primarily determined by the playing length of each hole from the teeing ground to the putting green. Holes are generally assigned par values between three and five, which includes a regulation number of strokes to reach the green based on the average distance a proficient golfer hits the ball, and two putts.
What is 5c credit analysis?
Credit analysis is governed by the “5 Cs:” character, capacity, condition, capital and collateral.
What are the 3 C’s of credit?
Character, Capacity and Capital.
What are the 7 C’s of credit?
The 7Cs credit appraisal model: character, capacity, collateral, contribution, control, condition and common sense has elements that comprehensively cover the entire areas that affect risk assessment and credit evaluation.