Banks which apply modelled estimates of specific risk are required to conduct back-testing aimed at assessing whether specific risk is being accurately captured. The methodology a bank must use for validating its specific risk estimates is to perform separate back-tests on sub-portfolios using daily data on sub-portfolios subject to specific risk. The key sub-portfolios for this purpose are traded debt and equity positions. However, if a bank itself decomposes its trading portfolio into finer categories (e.g., emerging markets, traded corporate debt, etc.), it is appropriate to keep these distinctions for sub-portfolio back-testing purposes. Banks are required to commit to a sub-portfolio structure and stick to it unless it can be demonstrated to the CBB that it would make sense to change the structure.