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Credit Risk Contributions to Value-at-Risk and Expected Shortfall

Alexandre Kurth, Dirk Tasche

cond-matarXiv:cond-mat/0207750

Abstract

This paper presents analytical solutions to the problem of how to calculate sensible VaR (Value-at-Risk) and ES (Expected Shortfall) contributions in the CreditRisk+ methodology. Via the ES contributions, ES itself can be exactly computed in finitely many steps. The methods are illustrated by numerical examples.

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