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    Question

    For market risk, the minimum capital requirement is

    expressed in terms of two separately calculated charges. Which of the following are those two risks charged for?
    A Specific risk and general market risk Correct Answer Incorrect Answer
    B special risk and general risk Correct Answer Incorrect Answer
    C liquidity risk and liquidation risk Correct Answer Incorrect Answer
    D counterparty risk and trading partner's risk Correct Answer Incorrect Answer
    E Liquidity risk and counterparty risk Correct Answer Incorrect Answer

    Solution

    The minimum capital requirement for market risk is expressed in terms of: ·         general market risk; and ·         specific risk (ie risk associated with exposures to specific issuers of debt securities or equities)

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