n NISM Certifications
VII NISM Series VII
Medium

VaR margins for liquid stocks are based on the ______ of the stock.

Practice question from NISM Series VII Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Profitability

  2. Volatility

    Correct answer

  3. C

    Price to Earnings ratio

  4. D

    Earnings per Share

Why this is the answer

Value-at-Risk (VaR) margins are calculated based on the stock’s volatility (Scrip Sigma), using historical price fluctuations.

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