I skipped Derivatives for L1.. What should I do now?

Hello every one…

This is my first post … I registered in this forum because of the support I felt since we all understand what each of us is going through …

So I passed L1 in December, Im planning to take L2 this June. However I am worried about the level of difficulty of Derivatives… I skipped it for L1 due to lack of time… but planning on covering all topics for L2…

Will I be able to understand Derivatives from L2 material now that I skipped the basics? Do I have to review L1 material first (I do not think I have enough time)?

Any advice would be highly appreciated…

Thank you,

Yes. I do believe they cover all the sections from Level 1 Derivatives before introducing Level 2 concepts. Those segments are optional but it might be worth reviewing before you move onto Level 2 derivatives stuff.

yes, they do repeat a lot of stuff, I wouldn’t worry

Thank you both… I’m a little relieved now =)

dont get too comfortable, deriv is extremely complex at Level 2

How far into Derivatives are you, Providence? And have you read all of the CFAI books?

Derivatives is a very challenging topic for a lot of L2 candidates. It certainly was for me. You don’t need to review L1, as the curriculum does a good job of brining you up to speed for the concepts in L2.

I dedicated a lot of time to derivatives in L2. Did a ton of questions to make sure I got the concepts down pat. I didn’t “master” the material, but felt confident enough with deriv. going into the exam. But during the exam, I left the deriv section last, and ended up running a bit tight on time, with only enough time to crunch out 1/6 questions. Ended up guessing most of the set. Luckily i passed.

Don’t take my exp. as “I can skip deriv and still pass”. But think about it in terms of “there’s no giveaways in L2, and even if you’re not 100% comfortable with deriv, you should know it well enough to at least pick up a few points.” The exam experience is full of surprises.

Ive done all of CFAI Derivatives and im halfway thru elan deriviatives now…

It’s intense… once you get the process down for binomial pricing it gets easier though…

futures/forwards seem daunting at first, but its very similar stuff once you understand the big picture

Thanx guys for the heads up … It’ll help a lot in formulating my studying plan …

might I add…


In fact, derivatives aren’t as difficult as many candidates believe. The primary problem, in my opinion, is that they are rarely explained fully, leaving most candidates with a ton of formulae to memorize, rather than giving them a solid understanding.

I’ve started writing a series of articles on derivatives, here: http://financialexamhelp123.com/level-ii-derivatives/. They might prove helpful.

I’m planning to write more; let me know if there are particular topics you’d like me to cover.

S2000 - had my first class last night, and first night of studying tonight… Starting with Econimics for Valuation… glad to see you are still here!


I agree. They’re far worse.


And you as well.

You’re welcome.

Greenman: I’ve posted articles on pricing and valuing forwards and futures, currency forwards, FRAs, and plain vanilla interest rate swaps:

If you wouldn’t mind, I’d love it if you would take a quick glance and give me your opinion on the helpfulness of the articles. (However, if you couldn’t care less, I understand completely.)

I’ll get to the other swaps (currency swaps, equity swaps) and options as soon as I can.


YI’d love to, but not right now. Why don’t you remind me on April 16th?

And yes, I am serious. I’d be glad to help out after tax season.

I knew you were serious.

I’ll put it on my calendar.

Save those taxpayers a bundle!

Hahahaha. +1

I’m half way through Derivatives…

I wouldn’t call them hell, they’e the HELL of HELLS !!