Because I had to wait 2 years before starting an MBA program…so I said what the heck. Not sure when/if I’ll ever take level 3.
Gents gents gents, Let’s be perfectly honest here: 1. It has the word “Chartered” it in. 2. The diploma kicks ARSE. 3. Chicks dig guys with the CFA. Willy
WillyR Wrote: ------------------------------------------------------- > 3. Chicks dig guys with the CFA. > That is questionable. And what of guys? Do they dig chicks with the CFA designation?
My friend thought he was smarter just because he did a 3 level multiple choice exams while I had an MBA from a top business school. I decided to do the test just to prove that CFA is not as hard as people think and also not to waste time participating in CFA/MBA debate with people who do not qualify for one of them, at least in the business school I went.
WillyR Wrote: ------------------------------------------------------- > 3. Chicks dig guys with the CFA. > > Willy I’ll tell you why I want the CFA: two chicks at the same time, man. I always wanted to do that. And I think if I finally get my CFA I could hook that up, too; 'cause chicks dig dudes with the CFA.
sublimity Wrote: ------------------------------------------------------- > bchadwick Wrote: > -------------------------------------------------- > ----- > > Because I wanted to learn how to manage a > > portfolio and evaluate securities, but didn’t > want > > to go back to school get an MBA (too many years > of > > schooling thus far). The credibility factor > for > > changing careers was important too, since I was > > too old for most entry level gigs. By the time > I > > was studying for L2, I also just wanted to do > it > > because I’d started and I wanted to get to the > > finish line. > > bchadwick saying pretty much what I’m saying but > without the edge, hahahaha > > My friends, this is a perfect description of how > an INTJ like myself approaches something compared > to an INTP like bchadwick. > INTJ: F-this, F-that, this sucks, that sucks. > INTP: This has its merits, that has its merits, > let’s consider this, let’s consider that. > > You are the man, bchadwick. 
apparently “ads by Google” thinks you guys are losers “Introvert = Loser Being Yourself is Not the Solution It’s the Problem. Learn to Change” I think I am a combination of the two “e” and “i” types so I will split the difference and create my own new type called “G”, or more precisely “Giggin’” Giggin, which means (according to urban dictionary dot com) “to go stupid dumb on the dance floor” or alternatively “when you start convulsing after poppin E tooo much and it starts to look like you’re dancing.” Either one works for me… oh I want the Charter so I go stupid dumb on the trading floor…
sublimity Wrote: ------------------------------------------------------- > bchadwick Wrote: > -------------------------------------------------- > ----- > > Because I wanted to learn how to manage a > > portfolio and evaluate securities, but didn’t > want > > to go back to school get an MBA (too many years > of > > schooling thus far). The credibility factor > for > > changing careers was important too, since I was > > too old for most entry level gigs. By the time > I > > was studying for L2, I also just wanted to do > it > > because I’d started and I wanted to get to the > > finish line. > > bchadwick saying pretty much what I’m saying but > without the edge, hahahaha > > My friends, this is a perfect description of how > an INTJ like myself approaches something compared > to an INTP like bchadwick. > INTJ: F-this, F-that, this sucks, that sucks. > INTP: This has its merits, that has its merits, > let’s consider this, let’s consider that. > > You are the man, bchadwick. apparently “ads by Google” thinks you guys are losers “Introvert = Loser Being Yourself is Not the Solution It’s the Problem. Learn to Change” I think I am a combination of the two “e” and “i” types so I will split the difference and create my own new type called “G”, or more precisely “Giggin’” Giggin, which means (according to urban dictionary dot com) “to go stupid dumb on the dance floor” or alternatively “when you start convulsing after poppin E tooo much and it starts to look like you’re dancing.” Either one works for me… oh I want the Charter so I can go stupid dumb on the trading floor…
What’s the point of being an extrovert if over ~84% of the world’s population has an IQ below 115? I mean, I’d rather sit in a corner by myself for hours on end than deal with 10 non-loser fxguy1234s because chances are, I’m much smarter than you and you would bore the hell out of me.
Also, the charter would not benefit traders as much as analysts or portfolio managers. In fact, I would bet that the knowledge gained by the charter would almost be irrelevant to the skill set that allows traders to excel.
CFA really does seem geared for training fundamental analysts. There’s almost no discussion about technical analysis, except a few pages in L1, and after that, almost all the trading discussion is about transactions costs. There’s not enough quant work in the CFA to do quantitative portfolio management or very much risk management. So, what’s left is fundamental analysis, which, admittedly, is probably the most commonly practiced investment method (per number of analysts) at buyside shops. I’m not too surprised about the technical analysis stuff. One can go elsewhere to learn TA. I am surprised that there isn’t a better connection between the valuation analysis and the portfolio construction parts of the curriculum. I mean that there are hundreds of pages of stuff on how to figure out what the stock price should be so that you can decide if it’s overpriced or underpriced, but when it comes time to construct a portfolio, what you need is an expected total return, and there’s no real way to turn “overpriced / underpriced” decisions into expected return decisions without doing something like arbitrarily deciding how long it will take a stock to converge to its intrinsic value and computing an IRR (and even that method wasn’t discussed in the curriculum, IIRC). It’s like they said 1) here’s how to compute intrinsic value, do multiples, compute a DDM, etc…, 2) here’s how to construct an optimal portfolio, but 3) we’re not going to give you the link between parts (1) and (2). If you’re thinking of the entire process from selection to construction, it’s a gap a mile wide. I think fundamental shops must just use equally weighted portfolios of their fundamental picks, or do some kind of optimization assuming historic returns and just hope that mispricings from intrinsic value show up as some kind of alpha.
sublimity Wrote: ------------------------------------------------------- >What’s the point of being an extrovert if over ~84% of the world’s population has an IQ >below 115? because I can definitley score more chicks than you, and in the end that’s all that really matters bud! Seriously, IQ probably is that not relevant to one’s success. I mean to a point it is but then there are probably diminishing returns after you are at a certain acceptable level. I’ll take charm, charisma, and communication skills ANY day over a high IQ. >I mean, I’d rather sit in a corner by myself for hours on end than deal with 10 non-loser >fxguy1234s because chances are, I’m much smarter than you and you would bore the hell >out of me. No surprise there… Even if you are “smarter” which is debatable, I would rather be leading people than following blindly (or sitting in a corner as you put it) > Also, the charter would not benefit traders as > much as analysts or portfolio managers. In fact, > I would bet that the knowledge gained by the > charter would almost be irrelevant to the skill > set that allows traders to excel. I’m aware of that, I just said “trading floor” because I could think of another funny play on “dance floor”. It’s more of a personal challenge with side benefits career wise, not sure where it will take me, but it is interesting material and also a challenge. I got a pure shot of adrenalin when I saw the word “PASS” today, you can’t buy that kind of feeling! Bchad- great analysis, I wonder if CFAI has looked at that… This post is all in good fun sublimity, I just had a laugh when I saw that strategically place google ad on the intj forum. I’m sure you’re a cool cat. -fxguy1234
I get too much entertainment from arguing with people on “teh interntz”.
haha you just gat pwn3d n00b!
bchadwick Wrote: ------------------------------------------------------- > CFA really does seem geared for training > fundamental analysts. There’s almost no > discussion about technical analysis, except a few > pages in L1, and after that, almost all the > trading discussion is about transactions costs. > There’s not enough quant work in the CFA to do > quantitative portfolio management or very much > risk management. So, what’s left is fundamental > analysis, which, admittedly, is probably the most > commonly practiced investment method (per number > of analysts) at buyside shops. > > I’m not too surprised about the technical analysis > stuff. One can go elsewhere to learn TA. > > I am surprised that there isn’t a better > connection between the valuation analysis and the > portfolio construction parts of the curriculum. I > mean that there are hundreds of pages of stuff on > how to figure out what the stock price should be > so that you can decide if it’s overpriced or > underpriced, but when it comes time to construct a > portfolio, what you need is an expected total > return, and there’s no real way to turn > “overpriced / underpriced” decisions into expected > return decisions without doing something like > arbitrarily deciding how long it will take a stock > to converge to its intrinsic value and computing > an IRR (and even that method wasn’t discussed in > the curriculum, IIRC). > > It’s like they said 1) here’s how to compute > intrinsic value, do multiples, compute a DDM, > etc…, 2) here’s how to construct an optimal > portfolio, but 3) we’re not going to give you the > link between parts (1) and (2). If you’re > thinking of the entire process from selection to > construction, it’s a gap a mile wide. I think > fundamental shops must just use equally weighted > portfolios of their fundamental picks, or do some > kind of optimization assuming historic returns and > just hope that mispricings from intrinsic value > show up as some kind of alpha. I’m not expert, but I’d put 90% weighting on the intrinsic valuation. I’d use Kelly Criterion for the portfolio construction (I don’t agree with modern portfolio theory as an assessment of risk)
To use Kelly Criterion, you need to have an accurate estimate of your probability of winning, and I’m not sure how you take account of portfolio diversification there. I’ve recently been reading up on the Treynor-Black model as a way to mix fundamental valuation with MPT. When I was cramming for L2, its utility never really sunk in, but I think that that might be the main key for linking the two. For me, this has been driven by the fact that I think recent events have created good opportunities for fundamental valuation, but how to mix it with an appropriately diversified portfolio or using technical indicators for understanding index moves is a challenge.
bchadwick, you have a good point, and I guess my style of diversification wouldn’t particularly be suitable for many people. That being said, I gravitate more to Mohnish Pabrai’s approach, where he allocates investment weightings as a percentage of his Kelly calculations (to hedge against the fact that exact probabilities are unknown) which are dictated by discounts to fair value. I tend to look at diversification on a surface level (i.e. buying airlines and oil and gas companies for negative correlation). I realize that two securities can become more correlated in different time frames (like now), but I’m not necessarily after reducing risk by reducing portfolio volatility. This might all sound like cliche Buffett, and it is, but it makes sense to me. I don’t believe in diversification for the sake of diversification; I believe more in holding a basket of good companies at discounts. I can take the large swings in price and sleep well at night knowing I’ve done my due diligence. I’d weight my portfolio based on how much of a discount I think I have to fair value (which I can represent as an expected value derived from probabilities plugged into the Kelly formula), and also hold enough different stocks to try and ward off over-confidence bias. I think if you read Mohnish’s book, he’d calculate a Kelly bet of something like 98% but would only put in 5%. It was some arbitrary maximum cap he set for himself. He prefers to focus more on the fundamental analysis, where it counts the most. Everything else might just fall into place in the long run.
I’m pursuing CFA to learn GIPS.
There are other reasons also but main reason is " to get out of gutter " I still hope that once I pass all three level I will have some chance to get out of gutter.