Potential Future Exposure: Difference between revisions
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imported>Doug Williamson (Create the page. Source: JP Morgan https://www.jpmorgan.com/jpmpdf/1320663533358.pdf) |
imported>Doug Williamson (Classify page.) |
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''Derivatives''. | |||
(PFE). | (PFE). | ||
The Potential Future Exposure (PFE) in a derivatives contract is an additional credit risk, over and above the current replacement cost of the contract. | The Potential Future Exposure (PFE) in a derivatives contract is an additional credit risk, over and above the current replacement cost of the contract. | ||
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* [[Confidence level]] | * [[Confidence level]] | ||
* [[Counterparty]] | * [[Counterparty]] | ||
* [[Credit risk]] | |||
* [[Fair value]] | * [[Fair value]] | ||
* [[Replacement cost ]] | * [[Replacement cost ]] | ||
[[Category:Identify_and_assess_risks]] | |||
Latest revision as of 07:00, 2 July 2022
Derivatives.
(PFE).
The Potential Future Exposure (PFE) in a derivatives contract is an additional credit risk, over and above the current replacement cost of the contract.
The PFE represents the additional amount by which the exposure could increase, over the remaining life of the contract, with a given level of confidence.
