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Validation Techniques

Champion-challenger

A benchmarking approach in which an institution's production model (the champion) is compared against one or more alternative models (challengers) built independently, often using different methodology, to test whether the champion's results are reasonable and to surface potential weaknesses.

Last updated: Last reviewed by: Model Risk Directory editorial team

How the term is used in model risk management

A benchmarking approach in which an institution's production model (the champion) is compared against one or more alternative models (challengers) built independently, often using different methodology, to test whether the champion's results are reasonable and to surface potential weaknesses. The exact implementation varies by institution, model type, risk rating, and governing framework. Use the linked regulatory pages and buyer guides below for scope-specific requirements.

Related glossary terms

Model validation

Guides and frameworks that use this term

GuideModel Risk ValidationModel risk validation is the independent testing of a specific model's conceptual soundness, ongoing performance, and outcomes, performed by staff or a third-party firm genuinely separate from that model's development. It is the 'effective challenge' function required under SR 26-2 and SR 11-7, distinct from broader model risk management program design.