Which One of the Following Is the Best Interpretation of This

question 69

Multiple Choice

Which one of the following is the best interpretation of this VaR statistic: Prob (R_p ≤ - 0.15) = 37%?

• A) If your portfolio declines by 15 percent or more, that decline is expected to be followed by a 37 percent increase in value.
• B) Your portfolio is expected to lose at least 15 percent, but not more than 37 percent in any given year.
• C) There is a 37 percent chance that your portfolio will decline in value by at least 15 percent over the next year.
• D) Sometime in the future, your portfolio is expected to lose 15 percent or more in a single year, but have an overall average rate of return of 37 percent.
• E) There is a 37 percent chance that your portfolio will lose at least 15 percent of its value over the next 10 years.

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Definitions:

Seniors

This term refers to older adults, typically those aged 65 and above, who are often distinguished by their age group for varying social, economic, and health-related considerations.

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Canadian Health Care System

A publicly funded and administered system that provides universal access to health care for Canadian citizens and permanent residents, based on need rather than the ability to pay.

Theoretical Perspective

A set of assumptions or a framework that guides how researchers interpret phenomena within specific fields of study.