diff --git a/Docs/UserGuide/parameterisation/ore.tex b/Docs/UserGuide/parameterisation/ore.tex index 0faca7a54..08b25425e 100644 --- a/Docs/UserGuide/parameterisation/ore.tex +++ b/Docs/UserGuide/parameterisation/ore.tex @@ -917,9 +917,9 @@ \subsubsection{Sensitivity and Stress Testing} See the examples in sections \ref{example:marketrisk} for a demonstrations of these analytics. -\subsubsection{Value at Risk} +\subsubsection{Parametric Value at Risk} -The {\tt VaR} analytics provide computation of Value-at-Risk measures based on the sensitivity (delta, gamma, cross gamma) data above. Listing \ref{lst:ore_var} shows a configuration example. +The {\tt VaR} analytics provide computation of parametric Value-at-Risk measures based on the sensitivity (delta, gamma, cross gamma) data above. Listing \ref{lst:ore_var} shows a configuration example. \begin{listing}[H] %\hrule\medskip @@ -964,6 +964,52 @@ \subsubsection{Value at Risk} See the example in section \ref{example:marketrisk_parametricvar} for a demonstration. +\subsubsection{Historical Simulation Value at Risk} + +The {\tt Historical Simulation VaR} analytics provide computation of historical simulated Value-at-Risk measures based on the historical market scenarios passed in a csv file. Listing \ref{lst:ore_histvar} shows a configuration example. + +\begin{listing}[H] +%\hrule\medskip +\begin{minted}[fontsize=\footnotesize]{xml} + + + Y + scenarios.csv + simulation.xml + 2017-01-17,2019-12-30 + 10 + USD + true + 0.01,0.05,0.95,0.99 + Y + Y + PF1 + histvar.csv + + +\end{minted} +\caption{ORE analytic: Historical Simulation VaR} +\label{lst:ore_histvar} +\end{listing} + +The parameters have the following interpretation: + +\begin{itemize} +\item {\tt historicalScenarioFile:} csv file containing the market scenarios for each date in the observation periods defined below; the granularity of the scenarios (e.g. discount and index curves, number of yield curve tenors) needs to match the simulation market definition above; each yield curve tenor scenario is represented as a discount factor. +\item {\tt simulationConfigFile:} defines the structure of the simulation market applied in the P&L calculation, e.g. discount and index curves, yield curve tenor points used, FX pairs etc. +\item {\tt historicalPeriod:} comma-separated date list, an even number of ordered dates is required (d1, d2, d3, d4, ...), where each pair (d1-d2, d3-d4, ...) defines the start and end of historical observation periods used. +\item {\tt mporDays:} Number of calendar days between historical scenarios taken from the observation periods in order to compute P&L efects (typically 1 or 10) +\item {\tt mporCalendar:} Calendar applied in the scenario date calculation +\item {\tt mporOverlappingPeriods:} Boolean, if true we use overlapping periods of length mporDays (t to t + 10 calendar days, t+1 to t+11, t+2 to t+12, ...), otherwise consecutive periods (t to t+10, t+10 to t+20, ...) +\item {\tt quantiles:} Several desired quantiles can be specified here in a comma separated list; these lead to several columns of results in the output file. Note that e.g. the 1\% quantile corresponds to the lower tail of the P\&L distribution (VaR), 99\% to the upper tail. +\item {\tt includeExpectedShortfall:} If yes, also include the expected shortfall in the output file +\item {\tt breakdown:} If yes, VaR is computed by portfolio, risk class (All, Interest Rate, FX, Inflation, Equity, Credit) and risk type (All, Delta \& Gamma, Vega) +\item {\tt portfolioFilter:} Regular expression used to filter the portfolio for which VaR is computed; if the filter is not provided, then the full portfolio is processed +\item {\tt outputFile:} Output file name +\end{itemize} + +See the example in section \ref{example:marketrisk_histsim} for a demonstration. + \subsubsection{P\&L, P\&L Explain, ZeroToParShift, Scenario} The {\tt pnl} and {\tt pnlExplain} analytics provide computation of a single-period P\&L and its diff --git a/Docs/UserGuide/parameterisation/todaysmarket.tex b/Docs/UserGuide/parameterisation/todaysmarket.tex index 56c3e8090..70fa83eba 100644 --- a/Docs/UserGuide/parameterisation/todaysmarket.tex +++ b/Docs/UserGuide/parameterisation/todaysmarket.tex @@ -35,7 +35,12 @@ \subsection{Market: {\tt todaysmarket.xml}}\label{sec:market} There can be alternative versions of each block each labeled with a unique identifier (e.g. Discount curve block with ID 'default', discount curve block with ID 'ois', another one with ID 'xois', etc). The purpose of these IDs will be -explained at the end of this section. We now discuss each block's layout. +explained at the end of this section. The ID 'default' has a special significance, being the default block that is taken by +ORE if no other ID is specified in the market configurations (see end of this section), however beware that this doesn't apply +to the dependency mechanism that collects curves before building other curves that depend on them (especially when using a lazyMarketBuilding parameter being set). +In this case you'd need to add the 'default' block to the market configuration as suggested for the {\tt IndexForwardingCurvesId} in the examples at the end of this section. + +We now discuss each block's layout. \subsubsection{Discounting Curves} @@ -459,15 +464,19 @@ \subsubsection{Market Configurations} \begin{minted}[fontsize=\footnotesize]{xml} xois_eur + default ois + default xois_eur + default inccy_swap + default \end{minted} \caption{Market configurations} @@ -486,4 +495,4 @@ \subsubsection{Market Configurations} 'lgmcalibration', 'fxcalibration', 'pricing' and 'simulation' (i.e. risk factor evolution). \medskip The configuration ID concept extends across all curve and volatility objects though currently used only to -distinguish discounting. \ No newline at end of file +distinguish discounting.