Basis Risks
Posted: July 11th, 2018, 1:33 am
Hi,
I have a question on terminology regarding "basis risk".
My understanding is that "basis risk" simply means the difference between two quantities. But I don't know why in quant finance difference is called basis risk? Can someone please explain?
Thanks
I have a question on terminology regarding "basis risk".
My understanding is that "basis risk" simply means the difference between two quantities. But I don't know why in quant finance difference is called basis risk? Can someone please explain?
Thanks