Advice for the Level III Essay Exam

[jasdev]

Who the f is downvoting so many useful posts in this thread??

[125mph]

@jasdev

Who the f is downvoting so many useful posts in this thread??

Yes, someone decided to blitz me with 20 downvotes across the spam of a few minutes. lol… i think I know who it is!

[taytus]

@125mph

@taytus

not in this case I agree, but for the other example I did you would run out of time comparing to the allocated time for that answer

if you look at prior exams guidelines, they state a reason for each rebalancing … Usually they give some options and you would circle “narrow” or “wider” and then it says justify in the box to the right. its not much time:

1. Transaction cost of Bonds expected to decrease so we narrow the corridor because it would be cheap to rebalance often 2) Volatility of Bonds expected to increase so we narrow the corridor to ensure we stay close to the SAA. If we don’t narrow, the higher volatile could cause our SAA to get out of proportion 3) Correlation of Bonds with portfolio expected to increase so we widen our corridor because positions are now moving in sync with higher correlations, so they are less likely to stray from SAA

Took me 30 seconds to type that.

If you took 30seconds that very good for you. To write you 3 sentences I would need 1.5 min (not everybody is english native speaker).

Furthermore you have also to read the vignette, understand,… I was very close to run out of time.

But I don’t think that’s so important, the real exam will be quite different than the essay mocks we have. At least, last year it was completely something different.