The increasing value of stress-testing portfolios

Research output: Contribution to specialist publicationArticle


Extreme market moves can negatively impact portfolios in ways which may not be captured by conventional risk measures, making meaningfully assessing portfolio risks challenging.

Portfolio stress-testing helps identify and quantify risks, helping reassure a manager how their portfolio might respond to significant market events or scenarios that reflect particular concerns.

Stress-testing includes a range of approaches, one classification is outlined in the figure (below). Historical events can provide ideas; however, practitioners can imagine many damaging situations for investigation using artificial scenarios.
Original languageEnglish
Number of pages1
Specialist publicationCitywire Wealth Manager
Publication statusPublished - 2 Feb 2017
Externally publishedYes

Bibliographical note


ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)


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