ALFI: Principles for sound stress-testing practices

17 April 2013

At the occasion of the ALFI - ALRiM Risk management conference on 17th April in Luxembourg, ALFI published its guidelines on Principles for sound stress-testing practices.

Stress-testing seeks to define the impact of extreme, but plausible scenario. It aims to provide an early warning signal so that the risk management procedures can operate accordingly and informed management decisions can be made. As such, stress-testing has become an important risk management tool that is required by supervisory authorities and is used by UCITS as part of their risk management process.

The ALFI new Principles for sound stress-testing practices guidelines provide insights into current market practices and how a management company could translate different regulatory rules into sound stress-testing practice for UCITS.

Full guidelines

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