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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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