Should I study FRA before Equity Valuation?

Hey everyone!

I am struggling to get the mechanics behind FCF calculations in Equity Valuation part. How the CFs interact with each other etc. Maybe I should study FRA first? What do you guys think?

Thank you!

Study whatever agrees with you first. You can always come back to the difficult parts later.

Doesnt FRA come before equity in the books anyway?..

FRA won’t help you with the basics of FCF. FRA is a whole another can of worms.

Either or. They’re both the 2 most heavily weighted topics on the exam. What exactly is causing you problems with the FCF formulas? A lot of the FCF formulas look intimidating, but they really aren’t. There is a pattern to calculating those formulas.

Hi

thank you for the answers.

Yeah as I noticed FRA is a different type of material. I thought it would have some stuff about the structure of the financial statements and how they interact since CFA 2 goes more into depth of the material, but I guess that’s accounting, not FRA. Anyways, I will study both and try to understand Equity… I don’t have much time left! Omg CFA 2 is much more detailed I imagined, it’s harder than CFA1!

lol man don’t start with FRA it will destroy your confidence omg trust me. It’s probably no comfort but Equity is probably the simplest section. Wait till you get to Fixed Income and Derivatives (Black Scholes ftw :stuck_out_tongue:)