I've been on "vacation" for a week and have been just reading my notes and doing problems. I don't know if I'll pass. I haven't done any mock exams because I haven't really felt confident enough in EVERYTHING to do that. Also, I still haven't done any problems for study sessions 16-18, though I did recently finish reading, summarizing in word, and doing example problems for them. I'll get that done over the next 4 days, and use Friday as formula memorization and polish. I've done so many damn questions in the last couple weeks that if I fail it won't be for lack of effort or study time... it will be something about the approach I guess. I went really heavy on reading and comprehension early on without doing as many problems as I would have liked.
I started studying for this thing 4 freakin months ago... I have trouble remembering stuff that happened last week, so to retain something I learned 4 months ago in vivid exam prepped detail is quite a challenge. Like a huge challenge. Like a challenge on par with successfully summoning a boner and doing Rosie O'Donnell (I don't think I'd be able to do it). Anyway, 5 days left... review for 3 sessions to go. I have to sleep now cuz it's 4 am. Hopefully my sleep schedule will fix itself by Saturday.
I will be so pissed if I fail this thing.
Monday, May 31, 2010
Sunday, May 2, 2010
15 down, 3 to go
My plan to finish my first run through by May 8th is not going to happen any more. Things went a little slower over the last week because of some stuff at work that, although positive for me, cost me time on updating resume, writing a cover letter, and so on. I don't know if I mentioned what my job was, but although the company is pretty reputable, I am way the fuck at the bottom of the totem pole; I'm on par with the mail guy. A manager approached me about an analyst position (a modest one, but it has the word analyst in the title so I'm happy). I'm pretty sure their deal is they'd like someone with analyst education, but they don't have the budget to pay for someone with analyst experience as well. Fancy title with shitty pay check? I'll take it! Can't be any worse than what I'm being paid right now. It's not a done deal though. At this point, I'm a turd in the pile, hoping to be scooped out and polished off for the gem within. We'll see about that though.
Whether or not I get that, the CFA level 2 exam is closing in fast, and I feel like I'll be more or less ready. The Fixed Income section really didn't do what I was expecting it to. I recall from level one that bonds with embedded puts and calls would converge on specific values as interest levels reached certain points (and yield curves for option free bonds would continue their more natural curves, if that makes sense). CFA 1 taught how find the max/min range wherein the fair price for an option embedded bond would lie, but then it said pinpointing a price was beyond the scope of the course. Naturally, I assumed that pinpointing this expected fair price, with a certain level of probability associated with it, would be something that came up in level two. Nope. No mention of it.
It actually focused very little on valuating conventional bonds. The 14th study session had a general run through of some of the theories out there that applied to fixed income instruments in general (much of which was redundant with level 1). It had a big chunk on credit ratings, and what factors bond rating agencies and investors will be concerned about, and so on. The 15th study session had a lot on MBSs and ABSs, with particular attention to the nominal spread, Z-spread, and Option Adjusted Spread.
Fixed Income was a very reasonable section, and much less quantitative than I expected. The math was there, but it was more in the background. For example, it showed how to draw up a binomial tree for an MBS or ABS based on treasury spot rates and adding a certain amount of spread until the pricing is right (PVof CFs = Price of security). I can't imagine them asking a multiple choice question on the exam where you have to draw a whole fucking binomial tree with all kinds of forward rates to consider (let alone 3 of them if you want to calculate duration and convexity). And a Monte Carlo Sim? Forget about it, unless they bring mainframe computers for all the candidates to work with... They're guaranteed to ask questions about how you would do these things conceptually, or even one branch of a tree I guess? But even drawing a branch would be kinda stupid... Anyways, Fixed Income was not so bad at all and I think I can suck up good marks in this section. Or I may just end up sucking. Whateva.
Derivatives on the other hand... this was one of my few 50-70 regions for the level 1 exam, and I expect it to be difficult in L2 again. I've been reading SS 16, and it's going slowly. The formulas are long, and many. Conceptually, it's just outright tougher than the other stuff in here, in my opinion. I can see why these instruments were used to fuck around so much leading up to the recession; they are trixy bastard. You can make them about as ambiguous and misleading as you want (and many did).
What a fun post that was! thanks for reading
Whether or not I get that, the CFA level 2 exam is closing in fast, and I feel like I'll be more or less ready. The Fixed Income section really didn't do what I was expecting it to. I recall from level one that bonds with embedded puts and calls would converge on specific values as interest levels reached certain points (and yield curves for option free bonds would continue their more natural curves, if that makes sense). CFA 1 taught how find the max/min range wherein the fair price for an option embedded bond would lie, but then it said pinpointing a price was beyond the scope of the course. Naturally, I assumed that pinpointing this expected fair price, with a certain level of probability associated with it, would be something that came up in level two. Nope. No mention of it.
It actually focused very little on valuating conventional bonds. The 14th study session had a general run through of some of the theories out there that applied to fixed income instruments in general (much of which was redundant with level 1). It had a big chunk on credit ratings, and what factors bond rating agencies and investors will be concerned about, and so on. The 15th study session had a lot on MBSs and ABSs, with particular attention to the nominal spread, Z-spread, and Option Adjusted Spread.
Fixed Income was a very reasonable section, and much less quantitative than I expected. The math was there, but it was more in the background. For example, it showed how to draw up a binomial tree for an MBS or ABS based on treasury spot rates and adding a certain amount of spread until the pricing is right (PVof CFs = Price of security). I can't imagine them asking a multiple choice question on the exam where you have to draw a whole fucking binomial tree with all kinds of forward rates to consider (let alone 3 of them if you want to calculate duration and convexity). And a Monte Carlo Sim? Forget about it, unless they bring mainframe computers for all the candidates to work with... They're guaranteed to ask questions about how you would do these things conceptually, or even one branch of a tree I guess? But even drawing a branch would be kinda stupid... Anyways, Fixed Income was not so bad at all and I think I can suck up good marks in this section. Or I may just end up sucking. Whateva.
Derivatives on the other hand... this was one of my few 50-70 regions for the level 1 exam, and I expect it to be difficult in L2 again. I've been reading SS 16, and it's going slowly. The formulas are long, and many. Conceptually, it's just outright tougher than the other stuff in here, in my opinion. I can see why these instruments were used to fuck around so much leading up to the recession; they are trixy bastard. You can make them about as ambiguous and misleading as you want (and many did).
What a fun post that was! thanks for reading
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