Treynor-Black

I just finished reading 71 SS 18 from Schweser which is the treynor-black reading. I thought they covered the topic quite well and the material was straight forward. Its not a new reading so I’m wondering what the big fuss was about last year concerning this topic. From what I recall, people on this forum were saying this topic was the reason why they failed. What was so infamous about this topic?

I think the issue was that it was not covered in Schweser last year, was in the CFAI readings, and came on the exam, so a lot of folks missed points on the entire item set. CP

I do not know about last year since I just passed level 1 in Dec. But I just read CFAI reading about Treynor-Black. I feel there are some differences. I guess they happened to test the material not on schweser. I am trying to read both. I felt ther are many differences between CFAI and schweser in various sections. I am going to focus on CFAI from now on.

In my view, anyone focusing on this to “avoid getting stung” is missing the point. The CFAI tests are about testing the obscure. So what is the most obscure portion of the deal this year? That’s where I’m fearful another item set can show-up and blow us up.

The Treynor Black was definitely covered in Schweser last year, in fact I reviewed it a few days before the exam but the questions on the actual exam were nothing like I had ever seen. I would have thought I’d nail any question on Treynor Black but I ended up getting less than 50% on that part. Luckily it was the only part I scored that low but you really have to understand more than just the concepts on some of the areas. I feel like you’ll have a few of those questions and you just have to try your best to put yourself in a position to answer them correctly. You won’t score a 100 so there will be some areas you will just not know, just hope you know the other stuff well enough to make up the ground.

yeah, treynor black was covered in schweser last time, and I felt that I understood it, then they on the test they hit you some very specific questions requiring you to calculate stats related to the model, etc. that you never saw in schweser. i definately feel that that section hurt me on the exam. this time around, I am focusing on schweser, but looking at the cfa books where time allows.

that’s what kind of makes me nervous about level 2. i just know every vignette will be in areas that i’m weakest in and all the stuff i feel great about will be left out. what a nightmare.

I’m right there with you cfasf1.

“The Treynor Black was definitely covered in Schweser last year, in fact I reviewed it a few days before the exam but the questions on the actual exam were nothing like I had ever seen.” “I thought they covered the topic quite well and the material was straight forward. Its not a new reading so I’m wondering what the big fuss was about last year concerning this topic.” Im one of those people who failed partially because of treynor black and echoing the first statement, the covering in Schweser was insufficient with respect to the test. It was a “surprise” topic to a large degree and lots of people hadnt spent the time necessary to score appropriately.

“that’s what kind of makes me nervous about level 2. i just know every vignette will be in areas that i’m weakest in and all the stuff i feel great about will be left out. what a nightmare.” Let me give you an example from last year of exactly this circumstance: The economics section last year had lots of juicy nuggets to test, including all the info on exchange rates. Rather than test any of the “important” topics, the 6 econ questions were on jibberish and required no math whatsoever (despite the fact that something like 85% of the readings were math related material).

To answer the question - One of the questions appearing on last years exam asked for math/calculation methodology which Schwesser specifically said was “beyond the scope of the L2 exam”. So to the original poster, ya I read TB inside and out and it seemed straight forward, I use it in real life and feel I understand it. However the questions on the exam were WEIRD and on at least one question Schwesser left us totally defenseless since they said “don’t sweat the details”. I believe that question was on the quant-stuff related to testing the accuracy of an analyst’s alpha picks…but it has been a long time and I blocked most of this crap from my memory!

I wonder…at the start of reading 71 in the CFAI text it states “candidates are not responsible, within Reading 71, for deriving or memorizing the formulas introduced in sections 4-6” Can I infer then that any and all questions on the test regarding calculation of alpha weights, performance measurements, analyst accuracy, etc. will give you the equations necessary to complete the problem? I ask because throughout all of their summary for reading 71, schweser doesn’t have their usual “CFA institute will probably give you the equations necessary” etc. etc. that they did at times for the quant section, and the entire reading appears like you need to know the formulae by heart.