treynor - black fiasco

ok, now i’m scared/confused. what is the potential litigation consolidate??

think BSF - Bear Stearns Fiasco. How many suits were on Bear Stearn’s desk when they got bought? Who’s bs are they on now?

This is more or less what happened. Treynor-Black was the second to last topic covered in the CFAI readings so plenty of people (who put in weeks of hard work reading the material) glossed over the reading as they pushed to the end. The LOS gives the impression that a conceptual understanding (maybe they’ll ask 1 concept question in a problem set) would be enough. LOS - “discuss the steps and the approach of the Treynor-Black model for security selection.” Although there were a couple “concept checks” in the reading, there were no box highlighted examples or end of section questions provided for this reading. The LOS is also pretty isolated from the over topics covered (whereas other LOS concepts kept showing up in the material…this is especially true in the quant, fsa, and corp. fin sections). This why I don’t fault Schweser for not covering the topic thoroughly. jpm351 Wrote: ------------------------------------------------------- > the fiasco was that schweser only had half a page > without 1 number in it and there ended up being a > 6 question vignette with calculations - I heard > the CFA text also did not do the section justice > given the question. > > > This year, I think everyone will be crying about a > couple time series questions and real estate.

Regarding my earlier comment re: litigation, if you account for a sub by the equity method, and then you enter into some form of litigation with them, you can no longer account for it with equity and must use available for sale