# Study Session 3: Quantitative Methods: Application

## Whats The efficient way to calculate the MAD in a hp12c?

–38.49%

–0.73%

0.00%

9.54%

11.39%

12.78%

13.41%

19.42%

23.45%

29.60%

I have all this values I know I need to calculate the mean first, however it`s possible to save the values in STO while pressing the M+?

When I try to save the numbers to the memories while calculating the mean with M+ it doesnt work…

I need to help I did some research but didn`t found something that cold help me

## Big Trouble with formulas

I`m having a big issue,

I finished R6 of quant and I`m in the last LOS of R7, but I`m having such a big trouble to remember formulas, it`s so use to confuse some of them, does anyone have a tip for me?

## Chebyshev’s Inequality

How you`re supposed to know Chebyshev’s inequality table??

I mean see the exercise:

According to Exhibit 27, the arithmetic mean monthly return and standard

deviation of monthly returns on the S&P 500 were 0.95 percent and 5.39 percent,

respectively, during the 1926–2017 period, totaling 1,104 monthly observations.

Using this information, address the following:

1 Calculate the endpoints of the interval that must contain at least 75 percent

of monthly returns according to Chebyshev’s inequality.

## Calculate the geometric mean return of SLASX

If you have all positive returns, in the formula, let`s suppose:

Year 1 - 34,9% year 2 - 6,13% year 3 - 2,69% year 4 - 11,66% year 5 - 21,77%

in the book the answer is:

(1,349)*(1,.0613)*(1,0269)*(1,1166)*(1,2177)^1/5 - 1

(1,349)*(1,.0613)*(1,0269)*(1,1166)*(1,2177)^0,2 - 1

My question is why instead of putting like 0,349 you need to add a 1 in all of them?

Can someone explain it please?

## Identifying Scales of Measurement

1 Credit ratings for bond issues.

2 Cash dividends per share.

3 Hedge fund classification types.

4 Bond maturity in years.

Answers: Ordinal Ratio Nominal Ratio

Why credit ratings for bond issues are not Interval?

Cash dividends can be 0 which would be anothing that`s why its ratio, right?

For Hedge Fund classification please I need someone to give me a example, cuz I just didn`t got it.

Bond maturity in years I also need a explanation.

## A client invests €20,000 in a four- year certificate of deposit (CD) that annually pays interest of 3.5%

A client invests €20,000 in a four- year certificate of deposit (CD) that annually

pays interest of 3.5%. The annual CD interest payments are automatically

reinvested in a separate savings account at a stated annual interest rate of 2%

compounded monthly. At maturity, the value of the combined asset is closest to:

PV = $20.000 CHS

i = 3,5

N = 1

PMT = 0

FV = $20.700

so at end of each year you will get $700 dollars from this CD

year 1

## Continuous Compounding on a HP12c

Given a €1,000,000 investment for four years with a stated annual rate of 3%

compounded continuously, the difference in its interest earnings compared with

the same investment compounded daily is closest to:

Can anyone solve this question step by step for me in a HP12c please?

IDK how to do continuous compounding in that and I need to know!

Thanks.

## Controversial Question, use days as 360 or 365

For a lump sum investment of ¥250,000 invested at a stated annual rate of

3% compounded daily, the number of months needed to grow the sum to

¥1,000,000 is closest to:

A)555

B)563

C)576

I will show this question have 2 answers depending if you do it with 360 and 365 and I need to know the correct answer…

PV = 250.000 CHS

FV = 1.000.000

I = 3/360

PMT = 0

N = 16.637 days

16.637/30 = 554,56 = 555 months = answer A

PV = 250.000 CHS

FV = 1.000.000

I = 3/365

## How Can I elevate a number in HP12c?

A bank quotes a stated annual interest rate of 4.00%. If that rate is equal to an

effective annual rate of 4.08%, then the bank is compounding interest:

A daily.

B quarterly.

C semiannually

the formula is:

EAR = (1 + Periodic interest rate)^{m – 1}

what is Periodic Interest Rate?

m would be by tentative 1 by each, right? so 365, 4, 2

Also how can I elevate a number in HP12c, can someone do a step by step?

Thank you.

## Future value of a delayed annuity

3)Two years from now, a client will receive the first of three annual payments of

$20,000 from a small business project. If she can earn 9 percent annually on her

investments and plans to retire in six years, how much will the three business

project payments be worth at the time of her retirement?

year 2 - $20.000

year 3 - $20.000

year 4 - $20.000

year 6 - retirement

i = 9

y2f = $28.231,63

y3f = $25.900,58

y4f = $23.762,00

sum = $77.894,21

# Study together. Pass together.

Join the world's largest online community of CFA, CAIA and FRM candidates.