Residual Risk Add On

Description The Residual risk add-on, RRAO
Reference [MAR23.8]
Formula $$RRAO = Addon \cdot Gross Notional$$

Residual Risk Add On is computed for trades bearing residual risk as a percentage of gross notional.

Trades bearing residual risk can be filtered using hierarchy [Risk].[Risk Classes] value “RRAO”.

Please note, that this measure disregards the actual capital treatment of individual positions and computes charges as if all positions are under SA. We recommend applying a filter on [Booking].[FRTB Model] equal to “SA” to limit the scope to positions officially under the “SA” approach.