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A chief risk officer at a leading financial institution is evaluating a proposal from an experienced risk analyst aimed at improving the firm's risk assessment processes. The analyst suggests simplifying the Value at Risk (VaR) calculation for the firm's large portfolio by consolidating the numerous trading positions into a smaller, more manageable set of core risk components. Which of the following methods would be the most appropriate for mapping the current positions?
A
Mapping USD/EUR forward contracts to the USD/EUR spot exchange rate.
B
Mapping each position in a corporate bond portfolio to the bond with the closest maturity among a set of government bonds.
C
Mapping zero-coupon government bonds to government bonds paying regular coupons.
D
Mapping a position in a stock market index to a position in a stock within that index.