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 (Layout) |
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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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== See also == | == See also == | ||
* [[Credit risk]] | |||
* [[Confidence level]] | * [[Confidence level]] | ||
* [[Counterparty]] | * [[Counterparty]] | ||
* [[Fair value]] | * [[Fair value]] | ||
* [[Replacement cost ]] | * [[Replacement cost ]] | ||
Revision as of 16:53, 15 November 2016
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.
