Margin Call Movie and Var Value at Risk Explained

2011 saw the release of Margin Call, a movie staring Kevin Spacey, Jeremy Irons, Demi Moore, Stanley Tucci and more. A very strong acting performance from the whole cast. But what was the problem they pointed to with their (Var) or Value at Risk Formula? What did the junior analysts figure out that the firm did not? Margin call was focused around 24 hours at an investment bank on the verge of a problem with their mortgage backed assets. Learn about another good finance movie plus an explanation of the (Var) Value at Risk theory and its good and bad.

What is VAR?

What is Value at Risk formula?

What type of data does VAR utilize?

Speculation on what investment bank Margin Call Movie is based on

Volatility based risk estimates

95% and 99% confidence levels and VAR

Simplified explanation of probability and confidence levels

Discussion on historical data and normal distribution to predict future returns

Implied Volatility to show expected single and multiple standard deviation moves

Implied volatility around earnings releases for momentum stocks like Netflix or Tesla

Mentioned  in  this  Episode:

Credit Default Swaps explained through the Big Short Movie https://podcasts.apple.com/us/podcast/the-big-short-movie-credit-default-swaps-explained/id1432836154?i=1000465683509

Contact Derek www.razorwealth.com

Derek Moore’s book Broken Pie Chart https://www.amazon.com/Broken-Pie-Chart-Investment-Portfolio/dp/1787435547/ref=sr_1_1?keywords=broken+pie+chart&qid=1558722226&s=books&sr=1-1-catcorr