Value at Risk (VaR): Parametric Method Explained

Discover the essential risk management tool, Value at Risk (VaR), through a comprehensive explanation of the Parametric Method, also known as the variance-covariance method. This video breaks down the VaR Parametric Method into easy-to-understand steps, from defining the concept to calculating VaR at different confidence intervals. Learn how to specify crucial inputs for VaR and master the calculations for both 95% and 99% confidence levels using this widely-used approach. Whether you're a finance professional or student, this tutorial by Ryan O'Connell, CFA, FRM, will enhance your understanding of risk quantification using the VaR Parametric Method.

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Chapters:
0:00 - Definition of the Parametric Method
0:24 - Specifying the Inputs to Value at Risk (VaR)
1:27 - Calculate Value at Risk (VaR) @ 95% Confidence Interval
2:37 - Calculate Value at Risk (VaR) @ 99% Confidence Interval

*Disclosure: This is not financial advice and should not be taken as such. The information contained in this video is an opinion. Some of the information could be wrong. This channel is owned and operated by Portfolio Constructs LLC. Some of the links above are affiliate links, meaning, at no additional cost to you, I will earn a commission if you click through and make a purchase.