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In the context of risk measurement, a risk metric is the concept quantified by a risk measure. When choosing a risk metric, an agent is picking an aspect of perceived risk to investigate, such as volatility or probability of default.[1]
In a general sense, a measure is a procedure for quantifying something. A metric is that which is being quantified.[2] In other words, the method or formula to calculate a risk metric is called a risk measure.
For example, in finance, the volatility of a stock might be calculated in any one of the three following ways:
Calculate the sample standard deviation of the stock's returns over the past 30 trading days.
Calculate the sample standard deviation of the stock's returns over the past 100 trading days.
Calculate the implied volatility of the stock from some specified call option on the stock.
These are three distinct risk measures. Each could be used to measure the single risk metric volatility.
risk, metric, this, article, relies, largely, entirely, single, source, relevant, discussion, found, talk, page, please, help, improve, this, article, introducing, citations, additional, sources, find, sources, news, newspapers, books, scholar, jstor, july, 20. This article relies largely or entirely on a single source Relevant discussion may be found on the talk page Please help improve this article by introducing citations to additional sources Find sources Risk metric news newspapers books scholar JSTOR July 2015 In the context of risk measurement a risk metric is the concept quantified by a risk measure When choosing a risk metric an agent is picking an aspect of perceived risk to investigate such as volatility or probability of default 1 Contents 1 Risk measure and risk metric 2 Examples 3 See also 4 ReferencesRisk measure and risk metric EditIn a general sense a measure is a procedure for quantifying something A metric is that which is being quantified 2 In other words the method or formula to calculate a risk metric is called a risk measure For example in finance the volatility of a stock might be calculated in any one of the three following ways Calculate the sample standard deviation of the stock s returns over the past 30 trading days Calculate the sample standard deviation of the stock s returns over the past 100 trading days Calculate the implied volatility of the stock from some specified call option on the stock These are three distinct risk measures Each could be used to measure the single risk metric volatility Examples EditDeaths per passenger mile transportation Probability of failure systems reliability Volatility finance Delta finance Value at risk finance actuarial Probability of default finance actuarial See also EditRisk measure Coherent risk measure Deviation risk measure Spectral risk measure Distortion risk measureReferences Edit Holton Glyn A 2004 Defining risk pdf Financial Analysts Journal 60 6 19 25 doi 10 2469 faj v60 n6 2669 Retrieved March 11 2012 Holton Glyn A 2002 Risk Measure and Risk Metric Retrieved March 11 2012 This finance related article is a stub You can help Wikipedia by expanding it vte Retrieved from https en wikipedia org w index php title Risk metric amp oldid 754066506, wikipedia, wiki, book, books, library,
