Economic Capital in Common Probability Distribution Formulas

Economic Capital refers to the amount of capital that a financial institution needs to hold in order to cover unexpected losses arising from various risks, such as credit risk, market risk,etc. And is denoted by EC.

Formulas to find Economic Capital in Common Probability Distribution

fxEconomic CapitalGo

List of variables in Common Probability Distribution formulas

fx Earnings at Risk Go

fx Required Rate of Return Go

FAQ

What is the Economic Capital?

Economic Capital refers to the amount of capital that a financial institution needs to hold in order to cover unexpected losses arising from various risks, such as credit risk, market risk,etc.

Can the Economic Capital be negative?

{YesorNo}, the Economic Capital, measured in {OutputVariableMeasurementName} {CanorCannot} be negative.

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