you’re a champ, fotis. But let’s not jump to the conclusion that we should use a variable that looks like it might be related or useful. From the practice exams I have done there have been plenty of facts given that are not critical - not trick questions, just red herrings. We should stick to the rule: when hedging a non-deliverable bond with a CTD bond, must use the yield beta. When just modifying duration with a CTD bond, don’t need yield beta. btw - i fould a very good explanation of the whole thing on p. 1318 of Fabozzi’s Handbook of F.I. Securities (7ed, 2005).
Well done fortis. Thanks for helping put this one to bed! Hopefully they’ll update the errata soon.
Referring the title of the posts, would you please kindly advise me which vignette you are talking about ? Is it the vignette in Example 11 on P.109~110 of Text Volume 4 ? Thank you so much !
AMC Wrote: ------------------------------------------------------- > Referring the title of the posts, would you please > kindly advise me which vignette you are talking > about ? > > Is it the vignette in Example 11 on P.109~110 of > Text Volume 4 ? Thank you so much ! nope Question 51 in the Free mock exam from the CFAI
They Fu****k up. They make me do gym to get around a wrong answer. I hate them. They better get the a**** straight up. I am not going to mess with them. Sorry folk for my not to kind words.
I print the mock again and I do not see the correction, AM I missing something here? Please help!
you take the correction and insert it into the mock. they dont reprint it.
budfox427 Wrote: ------------------------------------------------------- > you take the correction and insert it into the > mock. they dont reprint it. What do mean? They say “The vignette is being updated and the yield beta is being changed to 1.00. Also, the futures contract being used is the CTD bond. Yes, if you are given the yield beta of the bond to be hedged, you should multiply the hedge ratio by the yield beta” Where is the update?
I remember reading somewhere that when you dont give you a yield beta , you assume it is 1 . EIther ways I’m glad this was clarified . Good job Fotis21r !!!
Well done, thanks for the update! 128,600 candidates are writing the exam this June, with an average study time in the 250 hour range. That’s over 32 Million hours which have been/will be spent studying for the three Levels this June and I find it deeply disturbing when all three CFAI Mock Exams have Erratas and this error hasn’t even been included. I want to believe that this will not be the case on the actual exam.
fotis21r Wrote: ------------------------------------------------------- > AMC Wrote: > -------------------------------------------------- > ----- > > Referring the title of the posts, would you > please > > kindly advise me which vignette you are talking > > about ? > > > > Is it the vignette in Example 11 on P.109~110 > of > > Text Volume 4 ? Thank you so much ! > > nope Question 51 in the Free mock exam from the > CFAI fotis21r, Only one “free sample” exam available from CFAI, right ? Does CFAI has “Free mock exam” ? As far as I know, the mock exam (10 item set / 60 Q) shall be “not free”, am I right ? Please kindly advise.
AMC Wrote: ------------------------------------------------------- > Only one “free sample” exam available from CFAI, > right ? Does CFAI has “Free mock exam” ? As far as > I know, the mock exam (10 item set / 60 Q) shall > be “not free”, am I right ? Please kindly advise. The mock is free this year. First time ever. It is on the CFAI site.
AMC Wrote: ------------------------------------------------------- > fotis21r Wrote: > -------------------------------------------------- > ----- > > AMC Wrote: > > > -------------------------------------------------- > > > ----- > > > Referring the title of the posts, would you > > please > > > kindly advise me which vignette you are > talking > > > about ? > > > > > > Is it the vignette in Example 11 on > P.109~110 > > of > > > Text Volume 4 ? Thank you so much ! > > > > nope Question 51 in the Free mock exam from the > > CFAI > > fotis21r, > > Only one “free sample” exam available from CFAI, > right ? Does CFAI has “Free mock exam” ? As far as > I know, the mock exam (10 item set / 60 Q) shall > be “not free”, am I right ? Please kindly advise. AMC! Have you been hiding in the wood? What wrong with you dude? 
the mock is free, free, free, free ,free
Null: are you saying in the formula for adjusting bond portfolio durations, we should not use YB? The formula is: [(MD Target - MD Portfolio) / MD Futures] * Yield Beta * Value Portfolio / Futures price null&nuller Wrote: ------------------------------------------------------- > you’re a champ, fotis. > But let’s not jump to the conclusion that we > should use a variable that looks like it might be > related or useful. From the practice exams I have > done there have been plenty of facts given that > are not critical - not trick questions, just red > herrings. > > We should stick to the rule: when hedging a > non-deliverable bond with a CTD bond, must use the > yield beta. When just modifying duration with a > CTD bond, don’t need yield beta. > > btw - i fould a very good explanation of the whole > thing on p. 1318 of Fabozzi’s Handbook of F.I. > Securities (7ed, 2005).
.
tibwa Wrote: ------------------------------------------------------- > AMC Wrote: > -------------------------------------------------- > ----- > > fotis21r Wrote: > > > -------------------------------------------------- > > > ----- > > > AMC Wrote: > > > > > > -------------------------------------------------- > > > > > > ----- > > > > Referring the title of the posts, would you > > > please > > > > kindly advise me which vignette you are > > talking > > > > about ? > > > > > > > > Is it the vignette in Example 11 on > > P.109~110 > > > of > > > > Text Volume 4 ? Thank you so much ! > > > > > > nope Question 51 in the Free mock exam from > the > > > CFAI > > > > fotis21r, > > > > Only one “free sample” exam available from > CFAI, > > right ? Does CFAI has “Free mock exam” ? As far > as > > I know, the mock exam (10 item set / 60 Q) > shall > > be “not free”, am I right ? Please kindly > advise. > > > > AMC! > > Have you been hiding in the wood? What wrong with > you dude? the mock is free, free, free, free > ,free tibwa, I am really sorry as I did not know that a mock exam is free ! Now, I know what you have been referring. Thank you very much ! The Q51 of free mock exam is actually inconsistent with the vignette in Example 11 on P.109~110 of Text Volume 4. No yield beta is provided in Example 11 on P.109~110 of Text Volume 4. However, the formula for “Hedge Ratio” on P.112 of Text Volume 4 indicated that the yield beta shall be multiplied. There are so many discussions about this issue, but is it true that CFAI clarified this issue ? I can not find their correction in errata.
I’m trying to find out about this yield beta issue for question 51 of the CFAI mock exam – I incorporated the 1.12 yield beta and I’m not sure why the answer does not. I just checked and there is no clarification or errata update on the CFAI website. I’m not sure who it is saying that CFAI responded directly to them but I don’t buy it. Does anybody know the reason for not including the yield beta?
^ We’ve scoured the CFAI text and there’s no reason not to include yield beta in the calculation. Several people have confirmed with CFAI and Schweser.
So if they are correcting this, does anyone know how it will show up? I see no errata section on the CFA website. My guess is that no one knows, just checking.
gosh, this is excrutiatingly painful… can someone tell me how many readings this affects?? it’s like similar stuff is all over the curriculum. anyway, thanks for digging boys, i am mostly pounding this type stuff, IPS and behavioural finance the last week. just mistakes everywhere this year (in fairness to institute, alot of them in schweser) and then similar stuff all over the place.