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stress testing
stress testing definition - finance
A
scenario-forecasting technique applied to a portfolio or asset that evaluates
how the portfolio would respond if different adverse market conditions
occurred. Stress testing is one of the techniques done in risk management to
evaluate how badly the owner of the portfolio might be affected if certain
unexpected events occurred.
Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.
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