What is 'Conditional Value At Risk  CVaR'
Conditional value at risk (CVaR) is a risk assessment technique often used to reduce the probability a portfolio will incur large losses. This is performed by assessing the likelihood (at a specific confidence level) that a specific loss will exceed the value at risk. Mathematically speaking, CVaR is derived by taking a weighted average between the value at risk and losses exceeding the value at risk.
This term is also known as "Mean Excess Loss", "Mean Shortfall" and "Tail VaR".
BREAKING DOWN 'Conditional Value At Risk  CVaR'
Conditional Value at Risk was created to be an extension of Value at Risk (VaR). The VaR model does allow managers to limit the likelihood of incurring losses caused by certain types of risk  but not all risks. The problem with relying solely on the VaR model is that the scope of risk assessed is limited, since the tail end of the distribution of loss is not typically assessed. Therefore, if losses are incurred, the amount of the losses will be substantial in value.

Marginal VaR
The additional amount of risk that a new investment position ... 
Value At Risk  VaR
A statistical technique used to measure and quantify the level ... 
Risk Assessment
The process of determining the likelihood that a specified negative ... 
Incremental Value At Risk
The amount of uncertainty added to or subtracted from a portfolio ... 
Value Of Risk (VOR)
The financial benefit that a risktaking activity will bring ... 
Assessable Security
A type of stock that companies issued to investors at a discount ...

Investing
Value at Risk (VaR)
Value at risk, often referred to as VaR, measures the amount of potential loss that could happen in an investment or a portfolio of investments over a given time period. 
Professionals
Backtesting ValueatRisk (VaR): The Basics
Learn how to test your VaR model for accuracy. 
Professionals
Introduction To Risk Management
A solid understanding of risk in its different forms can help investors to better understand the opportunities, tradeoffs and costs involved with different investment approaches. 
Professionals
Risk Management Framework (RMF): An Overview
A company must identify the type of risks it is taking, as well as measure, report on, and set systems in place to manage and limit, those risks. 
Active Trading Fundamentals
How To Convert Value At Risk To Different Time Periods
Volatility is not the only way to measure risk. Learn about the "new science of risk management". 
Investing
What is Risk Management?
Risk management is the process of assessing, managing and also mitigating losses. For investors, risk management is where an investor assesses the potential for loss in an investment, or portfolio ... 
Professionals
Responding to Risks
Responding to Risks 
Professionals
Insurable Risks
Insurable Risks 
Professionals
Types of Investment Risks
FINRA Series 6: Section 9 Types of Investment Risks. This section explains different types of risks, exchange rate risk, Interest Rate Risk, Business Risk, Credit Risk, Taxability Risk, call ... 
Fundamental Analysis
How Investment Risk Is Quantified
FInancial advisors and wealth management firms use a variety of tools based in Modern portfolio theory to quantify investment risk.

What does Value at Risk (VaR) say about the "tail" of the loss distribution?
Learn about value at risk and conditional value at risk and how both models interpret the tail ends of an investment portfolio's ... Read Answer >> 
What are some common measures of risk used in risk management?
Learn about common risk measures used in risk management and how to use common risk management techniques to assess the risk ... Read Answer >> 
What is backtesting in Value at Risk (VaR)?
Learn about the value at risk of a portfolio and how backtesting is used to measure the accuracy of value at risk calculations. Read Answer >> 
What is a "linear" exposure in Value at Risk (VaR) calculation?
Learn how the valueatrisk (VaR) calculation is used for portfolios with linear risk as opposed to nonlinear risk, and understand ... Read Answer >> 
What do regulators think of Value at Risk (VaR)?
Read about the history of value at risk metrics, and learn how regulatory agencies played a role in their promotion and how ... Read Answer >> 
What does Value at Risk (VaR) have to do with maximization of shareholder wealth?
Learn about the value at risk statistical measure and how examining the VaR for their investments can help investors maximize ... Read Answer >>