Swaps, IR Options, Currency Swaptions

After reviewing the Blue Boxes and EOCs for the end of study session 15, I realized that I do not remember much from solving many of the problems from the first time through. There are about 25 different derivitave calculations here. Are you guys working through and memorizing how to do most of these? I just feel like I could spend 10 hrs here and still not be completely confident for exam day. I think I will review these questions again a week or two before the exam. Any advice on how to deal with this? I think my time is better spent elsewhere for now…

Are you referring to all the options startegies (spreads, covered calls etc), or swaps and caps etc as well?

It all comes down to Cost Benefit analysis now. For example something like AI which is bull crap 150+ pages and we might not even see a single question on AI, even if we do see a vignette - I am prettu sure 2 questions are going to be really straight forward of calculating a Share or something like that. Now lets say you spend a week going over the 150+ pages of bull crap and managed to get a 5/6 in the AI vignette, if it shows up. The CBA is to see if those 3 points are worth this much of extra effort. Focus on the bigger picture, not time to boggle down with the little little details now.

This is totally my perspective, no fumes.

I agree L3. Spanishesk, No I have all of the regular options and the futures calculations down, it is just like pages 435-500 introduce about 20 different swap, floating vs fixed, swaption, different currency problems that seem to be calculated in different ways depending on the circumstance. I get the basic ir option calculations, CFAI just throws in quite a bit of complicated material in those pages that doesn’t seem worth it to learn for the % of the test it is likely to be…

If I were to spend time on that, I would learn the combination of the call option/loan and put option and loan, and calculating the effective interest cost or effective interest earned. I think that is something that could show up, and its no too hard. Next thing would be the plain vanilla swaps. After that, who knows. Like L3Crucifier said, might not be worth the time. But i do think that first piece I mentioned is good test material

OK thanks… ya that calculation is somewhat straightforward. The questions and examples after that seem to go all over the place and require you to be able to calculate anything with swaps, swaptions, loans, currencies, etc… I think I am going to ignore that section and hope the call/put loan comes up from that section if anything does.