Understanding the concept of distribution is essential, particularly in discussing option products and value at risk (methodology for calculating market risk). One of the key assumptions on which option pricing models are based is that the observable market prices of financial assets are assumed to be log-normally distributed

Value at risk uses the concept of a confidence level, a fixed probability that a loss incurred over a specified number of days will be less than a certain amount based on this same distribution assumption for the prices of financial assets. So, an understanding of distributions and confidence levels is one of the foundations of proper risk management.

Objectives
On completion you will be able to:

• Understand how a random variable is distributed with a certain mean and standard deviation (variance)
• Evaluate the likelihood of a certain event with a specified probability

Registration Information

This short online course can be purchased individually or as part of the following discount scheme(s).

• Financial Analysis

Once purchased, you will have access to this course for 365 Days.

Cost:

40.00

UK£ EUR US$   excluding including VAT*

Related CPD Courses

• Differentiation and Integration Maths
• Estimating Volatility
• Indices Exponential Logs and Geometric Series
• Interest Calculations
• Interest Rate Volatility
• NPV and IRR
• Probability and Expected Return
• Time Value of Money

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