Monday 30 July 2012

Changes in the CFA Level II Curriculum from 2012 to 2013

  • Readings have been reduced from 64 to 56
  • Employee Compensation, Important FRA reading, has some revisions
  • Economics has been revamped to three readings i.e. Currency Exchange Rate Determination & Forecasting, Economic Growth & Investment Decision, & Economic of Regulation
  • A Note to Asset Valuation, Industry Analysis, & Valuation in Emerging Markets have been deleted in Equity
  • Alternatives first two readings have been replaced with Private Real Estate Investments & Publicly Traded Real Estate Securities
  • Fixed Income reading General Principles of Credit Analysis has been replaced with Fundamental of Credit Analysis
  • Using Derivatives to Enhance Return & Manage Risk has been replaced with Credit Derivatives: An Overview.
  • Two Portfolio Management Readings, A Note on Harry Markowitz’s Market Efficiency and International Asset Pricing, have been deleted.
  • Corporate Finance, Quantitative Methods & Ethics are the same

Saturday 28 July 2012

When I started off Preparing for Level II.

Last Year in September 2011 I started off preparing for Level II. The first area to cover was Fixed Income, as it was in Level I in January 2011. Fixed Income was covered in 6 readings i.e. 48,49,50,51,52,53. Initially 48,49, and 50 were covered as they were relatively easy. Reading 48 had some tricky areas which had the potential of being tested. Important for me were the cash flow analysis and the ratios which cleared when I completed with Equity especially readings related to FCFs. Immense information is found in these readings and firm grasp over these areas is a must not only with understanding and commanding perspective but also with respect to exams perspective. Almost two weeks were spent on these three readings. Reading 49 related to term structure and key rate duration was not that much difficult for me. I found reading 48 quite detailed and reading 50 interesting. Developing the binomial tree to value a bond with embedded option was a very learning experience. Although how volatility is implied or put into the tree actually in the real world remained a mystery, which I certainly will look into now, but on the whole it was interesting and required a lot of practice. These three readings were not that much difficult as compared to the other study session covering Fixed Income. A fair overview of how in depth Level II could be was considerably experienced by me during first two weeks. People claiming that CFA actually starts from Level II was something in my mind seemingly coming true! I was initially worried but never gave up. May be that's the reason why I have passed this exam...

Thursday 26 July 2012

Level II Story - 1st Episode

The purpose of writing this series of posts is to provide a narrative of last 8 to 9 months. How I started off with the preparations of Level II. What I had in mind before initiating my preparations. The routine I followed. The material I used. The tests I appeared in. The way I perceived things and what aided to the success. The value of success can not be imagined by me as I've passed in the first attempt. The vigour can be asked by those who unfortunately have failed after putting in all the efforts throughout the year. This is the first post of the series. I'll be sharing the whole stuff in a series.

Stay Tuned.

Tuesday 24 July 2012

CFA Level II result

I have passed Level II. Will post the details later. Thanks to all the people who supported during this journey... Passing in first attempt while living in this part of the globe and also securing above 70 in 8 areas our of 10 is certainly encouraging. Must appreciate my decision of trying FinQuiz Curriculum Notes, it turned out amazing.. Last but not the least thanks to the visitors of this blog...


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Monday 23 July 2012

Shit happens but Life moves on...

The greatest all-rounder in 150 years cricket history, Imran Khan, was dropped from the team after he played the first match. He is the only fast bowler in the cricket history to have changed his bowling action and have succeeded. With his career's last match he, as the caption of the team, won the world cup in 1992. So much from the Cricketing Legend. I once heard him saying that you do not deserve to win unless you have the potential to face failure. These words have changed my life. Confidence does shatter after getting failed but only those succeed who manage to build themselves up for another try. It took us all 7 to 8 long months to prepare for the CFA Level II exams, we all put in our best to prepare ourselves for nailing it but what if we fail??? Less than 24 hours left for the result to be announced. Recalling the exam reminds me of the uncertainty I was having while rolling the circles specially in Ethics, & Economics. FRA & Ethics grant me a bit of confidence but one never knows what will happen. Lets hope for the best and be ready for the worst. Like its said... Shit happens but life moves on...

Thursday 5 July 2012

Financial Modelling

In these days last year I had taken 3 days workshop on financial modelling. Together with our instructor and according to his instructions we made model and valued Colgate. Although the assumptions used in the model were of consensus analysts but building the model itself was an interesting and learning experience. Preliminary knowledge of using Microsoft Excel was a pre-requisite but the most important task was to collect the information from Financial Statements and to deal with non-recurring items in projecting. The workshop was based on making pro forma financial statements, doing DCF and scenario analysis. By plugging in the values we concluded the valued Colgate and guess what it was more or less similar to the actual market value of the data provided. A lot of terms were new to me when I had taken the workshop but after when I have appeared in Level II exam, I feel allegiance to the terminologies and towards my treatment of the financial statements. Those who can have access to such workshops must go for one and try to build a model themselves. It is very important in making the skill set capable to compete in this age.