How Risky Are These Wall Street Banks?

Can we rely on this one number to know how risky a bank investment is?

David Hanson
David Hanson
Mar 21, 2013 at 3:18PM

In the video below, Motley Fool financial analyst David Hanson takes a look at one number that stood out to him during the recent banking stress tests. He discusses the Value at Risk number, or VaR, and how to understand how much market and trading risk exposure this number shows a bank has. He also tells investors how the VaR can be misinterpreted, and why it can lead you to think that a bank has more or less market risk exposure than it actually does.