What is the formula for VaR

This means that variance is the expectation of the deviation of a given random set of data from its mean value and then squared.Intuitively we can think of the variance as a numerical value that is used to evaluate the variability of data about the mean.Let's understand how to use the function using an example.A specific time period, a confidence level, and the size of the possible loss.Var is determined by three variables:

Variance provides a general idea of the spread of data.It is what you get when you measure the rms volts with one meter and the rms amps with another meter and multiply the two.Now, let us calculate the squared deviations of each data point as shown below, variance is calculated using the formula given below.The var function estimates the variance for a sample of data.Result =var.s(a2:a11) variance for the breaking strength of the tools, when the values in a2:a11 represent only a sample of all the data.

According to layman, a variance is a measure of how far a set of data (numbers) are spread out from their mean (average) value.Formula =var.p(number1,[number2],…) the var.p function uses the following arguments:Excel var function is not used popularly.Result =var(a2:a11) variance for the breaking strength of the tools tested.We would then use the equation below to find our value at risk:

The structure remains the same for each six functions:Plug these into the simplified formula:Square each deviation from the meanThe closer the variance is to zero, the more closely the data points are clustered together.The 1% var is then $0, because the probability of any loss at all is 1/128 which is less than 1%.