@alta12
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Up7
@sophie Thanks! Scored better in Schweser Mock 2 PM but I think that is because they were my stronger areas. I still haven’t gone through quant (my weakest area) for the second time. Not sure if I should concede it and concentrate on other topics. And still have to memorise formulas. Totally freaking out!
Schweser style of presenting information is very different to CFA. For example they present binomial model information very differently 😮
Up6@ajfinance thanks! 🙂
Up5It’s in the Elan practice questions.
‘Since the put options is selling for more than its actual worth ($4 vs $3.05) we would sell the put and SELL n units of the underlying stock for each option sold.
It doesn’t make sense to me.
Up5Thanks Sophie.
So in summary, to achieve delta = 0:
1. Long call, short stock
2. Long put, long stock
3. Short call, long stock
4. Short put, short stockUp5@vicentt you are on a roll! Are you doing one mock per day?
Up5@sophie I’m still scoring in the high 50’s after 4 schweser exams. I make stupid mistakes and sometimes don’t understand the questions (the way it is phrased) and then lose half the questions in the vignettes. And it takes me one whole day to do one mock and debrief (check answers, practice similar questions). Is this normal pace?
Up5If putable bond z spread = -40bps and option cost = 25bps and an option free bond with the same credit rating, liquidity and maturity offered in the market at a nominal spread of -15bps and z spread of -10bps.
Up5@vincentt the reason is I’m scoring low (getting half the questions right) in these areas and it’s affecting my overall scores. If I can get some more points from my weaker areas then I feel a bit safer. But I also want to revise the heavier sections again. May be strapped for time. Thanks @Sophie. Will see how I go today with more revision.
Up5@shantala @sophie @diya I carry a red bull with me on exam day as well. I drink it just right before the afternoon session. Red bull has a huge tiring effect after the hit but by that time the exam will be over and it’s time to celebrate!
Can tuna is good for exam day. Low on carbs and good source of omega 3. :-bd
Up5Wow those are really good scores.
Up5I’ve gone back to revision. Will hit the CFA mock on Monday.
Up5You guys all in the northern hemisphere. I’m down under 🙂
Up5@vincentt I don’t agree with their answer at all. Did they read the answer and reasoning at all? It still doesn’t make sense particularly:
“At a 0.90 correlation between Lee’s human capital and the stock market, the optimal allocation is 20% to the risk free asset and 80% to stocks. Assuming weaker correlations between his income and the S&P 500, the allocation to the risk free asset will be lower and allocation to stocks will be greater.”
With such high correlation between Lee’s HC and the S&P 500 i.e 0.90 he should really be diversifying his FC by investing more in risk free assets. And as he ages and his HC reduces, his FC allocation to risky assets needs to increase. That’s how I see it.
The official answer stumped almost everyone here in the forum who replied. Surely, we can’t all be going MAD? @sophie Are we all over thinking it?
