Objectives On completion of this tutorial, you will be able to:

• Identify the main types and sources of market risk
• Recognize the problems with market risk management that were exposed by the global financial crisis and how regulators responded
• List the key components of a market risk management framework (MRMF) required for the effective identification, measurement, and management of market risk

Tutorial Overview Market risk is the risk that the value of a position may rise/fall due to changes in the market prices or rates. This may take the form of gains/losses arising from traded or nontraded positions. There are many influences on market positions, but the key drivers are interest rates, equity prices, foreign exchange rates, and commodity prices. This tutorial addresses some key issues associated with market risk: What is it? Where does it come from? How can it be managed effectively? And how has its management and regulation been influenced by market events such as the financial crisis and various rogue trader incidents? Prerequisite Knowledge Risk Management - Risk Types & Measurement Tutorial Level: Intermediate Tutorial Duration: 50 minutes