Business and Personal Finance Dictionary

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z 

• SCENARIO ANALYSIS
  
  1. In investment analysis, the process of examining the anticipated performance of an investment under a variety of alternative potential interest rate environments. 2. In bank asset/liability management, the process of modeling the anticipated effects of interest rate changes on the net income or capital of a financial institution. Scenario analysis incorporates assumptions for changes in the behavior of the institution's managers and its customers that are anticipated to be associated with the modeled changes in interest rates.
  
  Back