Level III - Mnemonics/Acronyms

CFA Level III
#1

I was hoping to start a tread for your top/favorite Mnemonics/Acronyms.

Someone started one last year and it was helpful.

I was hoping someone could provide some Mnemonics for Trading/Execution as pertains to Crossing Networks, VWAP, Brokered Markets… Additionally hoping for some pertaining to Liquidity-At-Any-Cost, Need-Trustworthy Agent…

Here are a couple of mine… although I am sure they are nothing new/unique, but was hoping to get the thread going.

Traits of a Benchmark : SAMURAI

S pecified in Advance

A ppropriate

M easurable

U nambiguous

R eflective of Current Investment Options

A ccountable (Owned)

I nvestable

Pension Fund - High Risk-Tolerance : ASLOPY

A bsence of Early Retirement Provision

S trong Balance Sheet (Low Debt)

L ow Correlation b/w Plan Assets & Broad Market

O verfunded

P rofitable Company (High Profit Margins)

Y oung Work Force

#2

Cognitive Biases - Belief Perseverance

Con servatism

Con firmation

Illusion of Con trol

Rep resentativeness

Hind sight

Cognitive Biases - Information Processing

F raming

A nchoring and adjustment

M ental accounting

A vailability

Emotional Biases

L oss Aversion

O verconfidence

S elf Control

E ndowment

R egret Aversion

S tatus Quo

#3

Cognitive Biases:

To Control the Framing , Conservative Representatives Agree * that in Hindsight , Trump lacks a Mental Anchor. *Represents availability…

Emotional Biases:

LOSSSER (Loss Aversion, Overconfidence, Self Atribution, Self Control, Status Quo, Endowment, Regret Aversion)

Grinold Kroner:

ER ik Prince* DIG MASS PIPES (Equity R eturn = D iv/Price + I nflation + G rowth - ( M inus) Change in S hares + ( P lus) Change in P/E *The CEO of Blackwater, the mercenary company that was under investigation in Iraq

Risk Premium Model

(James) Bonds R TIMID (Bond Return = R eal Risk Free Rate + T ax Premium + I nflation Risk Premium + M aturity Risk Premium + I lliquidity Risk Premium + D efault Risk Premium

#4

valid benchmark properties:

S - specified in advance A M - measurable U - unambiguous R - representative A I - investable

Don’t remember the others. Maybe its a shitty pneumonic :slight_smile:

#5

Appropriate and Accountable?

#6

NRABIA for macro attribution

TIMDIC - for risk premiums