What is VaR and why is it useful?

VaR stands for Value-at-Risk. The lower the VaR, the lower the presumed risk. By default, we show you a 95% VaR.

In this case, 95% is known as the confidence interval which implies a probability of 5% (100 minus 95).

Let's say that the 95% VaR for a fund is -23%.

This means that the fund has a 5% chance (i.e. 100-95=5) of losing 23% on an annualised basis based on it's historical return (in the case of Historical VaR) and realised standard deviation (in the case of Implied VaR).

We show VaR (both historical and implied) on single analytics pages as well as the screener columns, where you could search for say, the lowest VaR Large Cap fund.

You can learn more about VaR here