Anyone has some idea about how to prepare for the Individual Part? I rememeber after I opened the exam book and saw the first Individaul question, I almost passed out and at that time I knew that I have to come back next year. I really hate it and have no any interest in reading the material although I know it does me no good to pass the exam. I am totally at a loss on how to study this part this time?
Yep same here…the Q about the retired couple doing so at 60 or 65 freaked me out!
There are a few good questions at the end of some of the readings, but doing the IPS questions in the mock/samples are key. This thread is also good: http://www.analystforum.com/phorums/read.php?13,1000169,1000417#msg-1000414
Thank you. Yes, I think I need to do some practice questions at the end of the chapter, I am used to the Multiple Choices in Level 1 and 2 and need some time to adjust to the essay questions.
You will find many good ideas elsewhere on this forum - some additional thoughts below: - The IPS is where the rubber hits the road for investors. Many taking the CFA don’t see clients. If you are one of those, it may be tough engaging in the material. If so, try reminding yourself that ultimately this is how you get paid. With Ethics it is the most important material in LIII for you and those clients - Get into the habit of writing down what you are being asked to do. E.g. Calculate the required return, after tax and after inflation. Each word is vital and will direct you to searching out the necessary information in the case. My impression from the forum is many folks launch into an IPS answer, get part way through and realize they had missed a tax/liquidity/inflation fact that cases you do re-do everything and start off with time trouble. - It is quite legit for the question to specify the requirement to continue a current lifestyle at some (retirement) point in the future. See the Mrs Fairfax case (2009) - When calculating returns, exclude any immediate liquidity needs from the denominator - be very clear about the difference between ability and willingness to take risk and how to rank the overall risk - Work through the Examples (chap 14-2009) at least twice. I learnt a lot about the (careless) assumprions I was making by doing this even before I had read the chapter. - Compared to swap valuations, IPS’s are easy but only continued practice of examples will keep you in the CFA mindset. - strike out errors, erasing is a waste of time Good luck
Thank you for your advice, I am not working in Finance Industry at all. I am an accountant. I studied some finance subjects back in my master degree and it is 5 years ago. It is hard for me (the layman outside of the finance industry) to do the CFA without any industry experience and exposure. I will try my best this time and hope to kill it on 06 June 2010.
Think of it as a Cash Flow Statement. Start with all Cash Inflows (current investment balances + income from employment + dividends from investments, etc…), then subtract all short term (< 1 year) Cash Outflows (living expenses, home purchase, college education, etc…) to arrive at current net assets. Then apply Time Value of Money concepts to calculate annual return given the scenario. Don’t forget to add in any inflation adjustments to your return calculations.