answer to Part A: it states the correlation between inflation protected bonds and nominal fixed rate corp/gov bond are “low” (which is 0.71 and 0.80 respectively) answer to Part B: it states Asset classes should be diversifying, the example is Nominal US corp/gov bonds have “extremely high correlations” of 0.85 Please let me how to justify the level of correlation? 0.80 = low corr 0.85 = extremely high corr
tell me…
The only things I can say is that: 1. That 0.71 is really misleading, BUT 2. Even with the table information, it is FACT (from text, hehe — Reason B, example 6, p.198, cfai vol 3) that inflation inflation-protected bonds have low correlation with nominal bonds, because former is highly correlated with inflation, while latter is more correlated with nominal rates. 3. Just remember this for 7 more days! 
thanks sticky. too much to remember… 
ryanunsw Wrote: ------------------------------------------------------- > thanks sticky. > > too much to remember… Don’t tell me you expect yourself to brainstorm concepts in 3 hours Have you got your list of acronyms ready? 
definitely not, i’ll do it slowly, mate. i was using the acronyms from the site, including those classic one from you… but finding it hard to elaborate under stressed conditions. always seem to forget sth… so frustrating, and also the mind thinks a lot faster than my hand. i hate writing, always slows down the process. i always run out of time on AM, so annoying. what do you think of the passing rate in Australia and NZ?
ryanunsw Wrote: ------------------------------------------------------- > definitely not, i’ll do it slowly, mate. > > i was using the acronyms from the site, including > those classic one from you… actually I love my MRBSCFA the best — Mr. BS, CFA > what do you think of the passing rate in Australia > and NZ? no idea and I don’t care, mate. There should be zero correlation with the physical location, right?