Is it true that VAR works in the opposite direction, given that its a statistical estimate based on normal distribution?
eg if NPV = 1000, and 95% VAR = 800 we say we are 95% confident that the minimum NPV is 200
Can we also say we are 95% confident that the maximum NPV will be (1000+800) = 1800?
Thanks
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VAR
2y ago#1We can, but this is not the point of looking at the VAR because we are concerned about the risk of things being worse.
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