Annualized loss expectancy
Introduction The '''annualized loss expectancy''' (ALE)  is the product of the annual rate of occurrence (ARO) and the single loss expectancy (SLE). It is mathematically expressed as::Suppose that an asset is valued at $100,000, and the Exposure Factor (EF) for this asset is 25%. The single loss expectancy (SLE) then, is 25% * $100,000, or $25,000.The annualized loss expectancy is the product of the annual rate of occurrence (ARO) and the single loss expectancy.ALE = ARO * SLEFor an annual rate of occurrence of 1, the annualized loss expectancy is 1 * $25,000, or $25,000.For an ARO of 3, the equation is:ALE = 3 * $25,000.Therefore:ALE = $75,000
See also *Single loss expectancy
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