It’s after midnight (eastern time) which means that there are still 10 full study days left!
How is everyone doing mentally? Even though I still have trouble valuing swaptions, understanding what the f$%k an ARCH model is, going up, down, and around the bid\ask spread in order to make a riskless triangular profit, memorizing the Alt. Inv. formulas that I come across like once every 14th hour of studying, not writing run-on sentences, figuring out the difference between current and temporal method on one accounting formula in less than 15 minutes, correctly solving residual income problems, not mixing up the FRA notation with the fixed income forward rate notation, and the fact that I come across at least one formula a day that I swear to God I’ve never seen before, I’m feeling great! 10 hours can equal 100-120 hours of additional study time!!!
Just venting after a long 12 hours of studying. I’d share these feelings with my friends but I’m not sure they know I exist at this point and I know they wouldn’t get it. But seriously, stay strong everyone and keep studying.
Triangular Arbitrage is definitely in level 2 curriculum (ECON section). You may be asked to calculate/determine if triangular arbitrage exists. They may give you quotes without a bid/ask spread (e.g., USD/CAD = $1.05) and/or they may give you quotes with a bid/ask spread.
I struggle with triangular arbitrage using bid/ask spreads (which is in curriculum). A very common saying to aid people with bid/ask conversions is “up the bid, down the ask.” Therefore, when I stated " going up, down, and around the bid\ask spread in order to make a riskless triangular profit," I was just poking fun at that saying. As far as I know, there is no around the bid/ask spread. But there is most definitely triangular arbitrage in the curriculum (NOT riskless triangular profit
I really hate to confuse anyone this late in the game, apologies.
Arbitrage = riskless profit therefore “riskless triangular profit” = triangular arbitrage in a roundabout way, and it’s definitely in the L2 curriculum. The phrases “up the bid and multiply” and “down the ask and divide” helped me immensely last year.
This is my 3rd go at L2 and I was still getting the calculation wrong on the triangular arbitrage on the mocks. Had to re-read it again in the CFAI books and now it all makes sense.
I hope the actually exam won’t be so cruel to ask such a question…bwuahaha…sif.
This thread made me LOL! Thanks for the laughs, guys The only thing making me feel better is knowing I’m not alone in hating this f’ing exam. Things I am struggling with:
confusion on Econ as a whole
FRA - pensions
derivatives - can’t do swap calculations for the life of me
corp finance is always a hit or miss for me in practice tests
Ethics - I haven’t been doing too well on practice tests, I get like 50-67% per item set max
memorizing the alternative investments formulas
how to not feel sleepy as soon as I sit down to study every evening
What is everyone’s strategy for studying/brushing up on Ethics at this time? I tend to get 3 or 4 questions per ethics vignette correct on the mock exams and I would love to bump this up. I thought I’d do 50 problems from the Qbank every day until the test and review my mistakes from the mocks. If anyone has any advice, I’m all ears.
Nobody can - it’s weird. Especially in L2 wwhere they ought to be asking tricky one’s.
I just found out it’s ok to say “CFA charter is the highest credential in the investment industry…” That was a complete surprise. It was in a mock - i don’t know how I have it but I guess I would’ve printed it during the past 5 months of prep
^Yeah even I was like wtf. But it’s on a sample cfa exam I have from CFAI - I have no idea how I have it but it was in a pile gathering dust and I just decided to glance at while I eat my dinner (obviously I lost my appetite when I got this wrong).
Here’s the exact statement
“The CFA charter is the highest credential in the global investment management industry. As chartereholders we are committed to the highest ethical standards. Completion of the program has dramatically improved the team’s portfolio management knowledge and their ability to acheive better performance results”.
In the answer it states the statement is in compliance with CFA Institute Standards of Professional Conduct.
Maybe this is one of those cases where CFAI messed up. who knows!
Dude. I love this post. Haha I feel like I will be alive again when this is over.
I don’t think FRA notation will be an issue on exam. The thing that helped me with swaps was to “get out of discount land and into DISCOUNT FACTOR land”. I wrote this on a note card and it stuck for some reason. Treat everything as a discount factor… Coupons and Principal… And subtract what you pay from what you receive. I try to keeep those simple.
The currency stuff is what gets me. The Financialexamhelp123 articles have been a huge help.
The only thing making me feel better is knowing I’m not alone in hating this f’ing exam. Things I am struggling with: