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What are market and counterparty credit risks

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Reference no: EM133204964

1.) What is an Exchange-traded and over-the-counter derivative instruments? Include examples (I.E. Agriculture needs to be included as an example)

2.) What are Market and counterparty credit risks?

3.) What is a Derviative and why are they traded on Exchange-Traded Derivatives (ETDs) and Over-the-Counter Derivatives (OTCs)?

4.) What is an option, call, put, future, forward, swap and swaptions? Include definitions of each and examples.(I.E. Agriculture needs to be included as an example)

5.) What is market risk?

6.) What is netting and hedging? Why are they used in the commitment approach?

7.) What is Value at Risk (VAR)?

8.) What Value at Risk (VAR) methodologies such as Parametric, Historical simulation, and Monte Carlo simulation we use them?

9.) What is Counterparty risk? Includes Mark-to-market exposure, Operational risk, Legal risk, Collateral risk, and Settlement risk. 

10.) What are counter risk methodologies? 

Includes:

  • Notional of contracts
  • Current mark-to-market
  • Expected exposure
  • Stressed future potential exposure

Reference no: EM133204964

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