Business and Personal Finance Dictionary

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• STRESS TESTING
  
  Same as stress analysis or stress scenario. Modeling a series of unusual, hypothetical events or scenarios. Stress tests may model the impact of extreme market conditions, or they may model the change in the measured amount of value at risk (VAR) that occurs when simulation assumptions are pushed to extremes. For example, stress tests for correlation measures of VAR include simulations in which the correlations are assumed to change dramatically. See value at risk.
  
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