Skipping SMA
One of my pet topics in Risk Management is Operational Risk in a Banking Context !!! Patrick McConnell "Guan, very good point. Basel is lost on Operational Risk - new SMA is a disgrace" Patrick is so spot on, SMA is a disgrace for at least three reasons. Firstly and foremost it is a proxy measure of risk and consequently up for manipulation, notwithstanding it isn't a coherent measure of risk and at best a weak attempt to price risk or develop an industry-wide benchmark. Seco
