Read? "How Singapore Manages its Reserves"
MAS employs a comprehensive range of stress tests to assess the risks to the portfolio on an ongoing basis and establish whether the portfolio remains resilient to potential tail risk events over the medium term.
Three types of stress tests are conducted:
Historical: Shocks are applied to the portfolio using asset price movements seen in historical stressed episodes, such as the Global Financial Crisis, 2000 dot-com bust, 1994 bond market selloff, etc.
Vulnerability-based: The portfolio is subject to hypothetical scenarios which stress in turn each of the portfolio’s risk factors such as equity, interest rate, credit, inflation, and foreign exchange.
Thematic: These are forward-looking stress tests and are designed by taking into account prevailing market conditions and potential risk events on the horizon.
Depending on the stress test results, MAS will consider appropriate responses and portfolio adjustments when needed.
The risk management framework is reviewed on a regular basis to ensure it remains fit-for-purpose.
Posts
CW,
ReplyDeleteYou naughty uncle!
Frightening little children...
Look away now children. Nothing to see here!
Cannot. You must sweet talk and offer reassurances like the snake oil gurus.
If you think you can, you can!
And we just need to set goals and work on our plans. That's all!
Just invests for the LONG TERM, and all of us will make money one!
(Of course not a single guru will offer moneyback guarantees)
:-)
DeleteStress test is not that cheem. Just feel 50% down can still sleep or panic sell to calm down - I had sold!
ReplyDelete