# What topics are you passing on reviewing due to time constraints?

As I go through my review, I come across some things where I’m just like “There’s no point in spending precious time learning this when the exam is just days away, so I’m just going to skip over it and focus on everything else.”

I find myself passing on detailed review of Bayes’ formula, GDP income approach, FCFE/FCFF, levering/unlevering, beta, margin call levels, forward rate from spot rates, effective duration, lower/upper bound for American and European options. I’m going over everything else though.

I think I can teach you fwd rates from spot rates in 1 minute:

Everyone understands compunding interest right?

2% interest per year in 3 years is: 1.02*1.02*1.02=1.02^3

This also needs to hold true for forward rates. Say 4 year interest is 4% per annum and 5 year interest is 5% per annum then compounding 4years and 1 year needs to be same as 5 year.

So: 1.04^4 * 1.XX^1 = 1.05^5

Just solve for 1.XX --> 1.XX = 1.05^5/1.04^4

By passing, do you mean you already mastered them and no need to go back or you don’t know how to do them?

If you don’t know them, i think the only topics you can allow yourself to pass bayes formula and GDP income approach, too long and little chance of being in exam. But all the others you should know them. They will be in the exam for sure!!!

Deffered Tax and Liabilities. Luckily I know the basics that can give me a 50/50 shot. And there is something else, but i forgot.

I am still finishing my mock exams within 2 hours, so I am hoping in the real exam the extra time will help me the questions I am iffy about.

Does economics count as a topic? In struggling to review that!!

Passing as in I don’t know how to do them and would rather spend the next 5 days reviewing/mastering everything else. I know those subjects I’m skipping will be on the exam, but no one gets 100% anyway, so I’m going to let those be the ones I’ll guess at and instead focus on getting the rest right or at least be able to eliminate wrong answers.

I won’t be passing any topic. I have always been of the opinion that the more you learn the things you don’t know, the better off you are. Simply reading the things you already know a hundred times again whilst deliberately ignoring the things you know you don’t know, in my opinion, isn’t the best strategy

Same pinion with Bloodine. Not knowing all those is -10 in exam straight!!

I sat for this exam in june not mastering any of the formulas you mentionned. guess what happened to me…

I tried the same tactic my first attempt which is why I’m still in the level 1 forum.

I only dont know bayes formula . will take an educated guess. My guess was right in mock lolz

So some of the comments here have encouraged me to go back and learn some of that stuff. So I will make sure I get Bayes’, forward/spot conversion, and FCFF/FCFE.

But I’m still skipping over the American/Euro option min/max formulas.

Yeah - payments in swaps.

But alot of the ones you mention aren’t really more than knowing one formula - lever unlever, margin call level, and duration are all pretty easy. Calls/puts, probably close on risk/reward but i was able to recreate the table after a half hour or so and repetitions writing it. I think you can still get pretty high return off these.

I’m passing on ethics. What a waste of time, all you basically need to know is “don’t do bad stuff” and you’ll be fine.

I cant get my head around economics, may be becz i am from a non-fin background but I work for an investment bank. Economics looks really daunting, i am not able to score more than 40 in it.

Any advice how to approach it. I know it’s a bit late

probably hypothesis testing/t values and stuff like that. I know enough that I basically have a chance of working it out correctly, but my mind just doesn’t grasp things like p-values, rejection etc.

bayes formula, but mostly because on the practice exam they gave us the formula, which leads me to believe IF it’s on the exam they’ll do the same?

umm…pensions & warranty I guess.

I know enough about all of these to make an educated guess, i’m just not beating myself up to master them anymore

Just take a step back when reviewing it. Make connections with different topics throughout Micro and Macro. With Econ there are always multiple moving peices that abide by the same rules. In my mind and on paper I constantly refer to a supply and demand graph and how the two move in reponse to each other and external factors. If you can understand these movements, a lot of the topic areas covered revert back to that thought process.

Always apply logic where your understanding isn’t definite.

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Just take a step back when reviewing it. Make connections with different topics throughout Micro and Macro. With Econ there are always multiple moving peices that abide by the same rules. In my mind and on paper I constantly refer to a supply and demand graph and how the two move in reponse to each other and external factors. If you can understand these movements, a lot of the topic areas covered revert back to that thought process.

Always apply logic where your understanding isn’t definite.

Yes! This man has the right idea. I say this because that is exactly what I am doing, lol! Bayes formula and GDP income approach are sooo long, and even IF they are on the exam, you’d be best off to sacrifice them because they will only be worth one point, and that one point isn’t worth all the time it takes to learn them.

However, having said this, things like FCFE, FCFF, unlevering, levering, beta, margin calls, forward rates, spot rates, effective duration, convex duration, and lower bounds on options are all VERY critical, and honestly, it is just a couple of formulas, and they aren’t very long IMO. FCFE and FCFF are very similar, lower bounds on options is just a matter of logic: Euro options are bullet style, so to value them, you need to discount them. Duration and convex duration are also very similar, fwd rates to spot rates is a simple arbitrage formula (someone answered this already), levering and unlevering is literally just arithmetic because you rearrange the formula. Margin call also has a formula Margin Call = [Po(1 - Initial Margin)]/(1 - Maintenance Margin)

For me the whole ai section (read it only twice, small weighting) and sampling and hypothesis. Sampling n hypothesis drive me mad. I read d section 5 times and still manage to answer wrongly 3/3 in all mocks i have taken so far (four 6-hour mocks). Rather than stressed out, i will just skip it for now.