BP-CVaR: A novel model of estimating CVaR with back propagation algorithm

C-Tier
Journal: Economics Letters
Year: 2021
Volume: 209
Issue: C

Authors (2)

Wang, Gang-Jin (Hunan University) Zhu, Chun-Long (not in RePEc)

Score contribution per author:

0.503 = (α=2.01 / 2 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We propose a more flexible and useful model, BP-CVaR, to estimate conditional value-at-risk (CVaR) using back propagation (BP) algorithm, which can capture the change of markets and use the information to adjust the next CVaR result. We use three samples including S&P 500 index, Nasdaq index, DIJA index and compare the results by back-testing approaches. We find that (i) BP-CVaR is more reliable and has higher accuracy than Monte Carlo CVaR model and (ii) BP-CVaR can react to the change of markets more quickly than traditional CVaR model.

Technical Details

RePEc Handle
repec:eee:ecolet:v:209:y:2021:i:c:s016517652100402x
Journal Field
General
Author Count
2
Added to Database
2026-01-29