A Division of Windham Capital Management, LLC

Absolute Loss and Relative Loss

What is the difference between absolute loss and relative loss? What do they mean?

Absolute Loss refers to the probability of a given loss from the selected portfolio

Relative Loss is the probability of the selected portfolio underperforming the benchmark by a specified relative loss percentage. The benchmark can be defined in the setup section of the software. This measure may not be relevant to the individual client but it is common applications with money managers and institutional clients.

Category:Understanding the Software -> Exposure to Loss