Portfolio Risk & Return

Stress Test

An estimate of what a portfolio might lose if a past crisis — the 2008 financial crisis, the 2020 COVID crash, the dot-com bust — happened again. Rather than asking how a portfolio behaves in an ordinary year, it asks how it fares in a bad one, which is where risk is actually felt. Meridian estimates most scenarios from the portfolio’s beta: it scales the stock market’s fall in that episode by how strongly the portfolio has moved with the market. That gives a quick, consistent sense of exposure, but it is not a replay of history — a portfolio of companies that did not exist in 2008 still gets a 2008 figure, and holdings that broke from their usual pattern in a crisis (as stocks and bonds fell together in 2022) are not captured. The recovery period beside each scenario is a rough historical guide to how long such an episode took to heal, not a forecast for this portfolio.

Educational information, not investment advice. See it applied across the screener →