FIN320 - 16

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  1. Concentration Risk
    Occurs when lending is exposed to one style of borrower
  2. Prepayment Risk
    Lenders cannot re-invest in new loans at the same rate, thus making a loss if borrowers refinance at lower rates.
  3. Explanatory Variables
    Explanatory power

    Forecast ability 

    Stress testing versus forecasting models

    Model coverage 

    Data availability 

    Correlations among variables

    Representation and coverage
Author:
Lea_
ID:
335300
Card Set:
FIN320 - 16
Updated:
2017-10-23 22:40:59
Tags:
FIN320 FINAL
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Description:
FIN320 - Quantitative Finance
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