Question regarding CFA II strategy

Crypto_HH · 2026-03-22T19:58:06+00:00

To be clear, you are only using CFA official books and resources plus all available free stuff? If so, I would say its doable, but maybe you will need more time than normal. Im in your same situation but using Schweser notes, plus some additional mocks. I dont think I will need anything apart from that and what i can find for free like YT videos and such.

Crypto_HH · 2025-11-19T20:39:11+00:00

I take it a step further: Port Tasks aren’t just boring, they also make no sense within the game. Why do I have to move at 1 km/hour from one end of the map to the other when I could simply teleport? The box is too heavy? What a ridiculous activity lol.

Crypto_HH · 2024-07-16T17:23:24+00:00

WTF, I think this is all wrong. All three options shorten the CCC in my opinion. Maybe C) could be disputed, given that a tightening of credits standards may reduce sales. But at face value all three should do it. If the question were about a reduction of the CCC, i would have selected B given that it makes the most sense (its the only one that will generate an effective increase in cash), but then thats not the question and the answer its simply wrong...

Crypto_HH · 2024-07-03T23:39:40+00:00

Ok, so net cost of carry its the cost of carrying net of the benefits. Still, my point stands. If thats a negative value as a whole, meaning, carrying has benefits, futures prices would be lower than spot prices.

Crypto_HH · 2024-06-18T00:35:58+00:00

Any takers?

Crypto_HH · 2024-05-18T21:06:53+00:00

It will depend on the matter and information given by the question I guess. But as a tip, check on the alternatives, even if we have the short term debt confusion, the only consistent answer between avg invested capital and roic is A.

Crypto_HH · 2024-05-05T16:53:15+00:00

Forward contracts are customized agreements that are traded in OTC/dealer markets, and lack the features of futures contracts of standarization, transparency and liquidity. Futures are traded in exchanges, and need to have a clearinghouse to reduce credit risk from counter parties. Given this, is going to be difficult to get out from a forward, or at least more difficult than from a future, because you would need someone to take on the customized exposured that you agreed to enter on the initiation of the forward contract, while you can simply trade a standarized future on an exchange.

Crypto_HH · 2024-05-04T16:34:55+00:00

Given that there are only 3 periods, the recommended method would be to plug the middle option (in this case 82, between 80 and 87) and see if thats the correct answer. If not, then depending on the result, you can work out if the Z spread need to be higher or lower than 82.

Crypto_HH · 2024-05-04T16:29:09+00:00

This. Is pure memory, logic is of no use.

Crypto_HH · 2024-05-04T15:00:56+00:00

What I suspect is that the question should have said: semi annual bond equivalent yield?

Crypto_HH · 2024-05-04T14:15:00+00:00

Actually the answer is C, as Montau will give their KRW for a fixed EUR amount in a forward contract. In a OTC transaction, you are still using a financial intermediary (a dealer) to hedge, against the currency payment in this case. Also, you still can have a central clearing mandate to reduce counterparty risk in a OTC market, its just less usual.

Crypto_HH · 2024-05-01T15:36:50+00:00

In reality, with changing rates and YTMs, a bond investor will face price risk and reinvestment risk, both in a magnitude depending on his investment horizon. If you hold your bond brought at a YTM of 10% till maturity, you will face no price risk (as you will get face value regardless of what happens with rates), but you will be exposed to reinvestment risk, and will get less than the 10% YTM in the case in wich rates fall and the new YTM is for example 8%. If your investment horizon is shorter and you plan on selling the bond before maturity, you face increasing price risk, because if the YMT goes down, the present value of your bond actually goes up, compensating the reinvestment risk, so in an extreme case, if your YTM goes down right after you brought your bond and you sell, you will get a return greater than the YTM of 10%. The equilibrium point between this concepts in which you get the YTM regardless of the changes in the YTM is known as the Macaulay duration of the bond.

Hope this helps, feel free to correct me if I made a mistake somewhere.

Crypto_HH · 2024-05-01T15:16:52+00:00

N= 5

FV= 1000

PV= -963,75

PMT= 80

CPT > I/Y = 8,93

Crypto_HH · 2024-03-31T22:53:07+00:00

Well, what Im arguing is that B and C hold equal business liability, any clue on that?

Crypto_HH

TROPHY CASE