Difference between revisions of "Economic Capital"
From Open Risk Manual
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== Definition == | == Definition == | ||
| − | '''Economic Capital''' denotes a set of concepts, tools and processes that aim link the capital structure of the firm to its risk management profile and objectives | + | '''Economic Capital''' (''ECAP'') denotes a set of concepts, tools and processes that aim link the capital structure of the firm to its risk management profile and objectives |
== Applications == | == Applications == | ||
| Line 12: | Line 12: | ||
* Risk Hedging | * Risk Hedging | ||
* Risk Attribution. | * Risk Attribution. | ||
| + | |||
| + | == See Also == | ||
| + | * [[Risk Capital]] | ||
---- | ---- | ||
[[Category:Tail Risk]] | [[Category:Tail Risk]] | ||
[[Category:Risk Management]] | [[Category:Risk Management]] | ||
Latest revision as of 12:25, 16 September 2021
Definition
Economic Capital (ECAP) denotes a set of concepts, tools and processes that aim link the capital structure of the firm to its risk management profile and objectives
Applications
- Asset liability management (ALM)
- Financial planning (merger and acquisition analysis, business growth strategies and capital management)
- Regulatory compliance. Use of internal risk management models in the satisfaction of SREP / ICAAP
- Investment strategy
- Risk Pricing
- Reserving
- Risk Hedging
- Risk Attribution.
