Portfolio Selection Based on Modified CoVaR in the Gaussian Framework

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Abstract

We study the Mean-Risk model, where risk is measured by the Modified CoVaR \[ \CoVaR^{\leq}_{\alpha, \beta}(X|Y) = VaR_\beta ( X \;| \; Y + VaR_\alpha (Y) \leq 0).\] We prove that in Gaussian setting, for sufficiently small $\beta$, such model has a solution.

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europepmc
last seen: 2026-05-20T01:45:00.602351+00:00
unpaywall
last seen: 2026-05-24T02:00:01.246996+00:00
License: CC-BY-4.0