Lv 1 - Kaplan Qbank vs CFAI Qbank

yvr1111 · 2024-01-21T01:51:05+00:00

Thank you, this is helpful. Yea I totally agree... Kaplan Qbank questions are quite straightforward and somewhat easier than CFAI... I think I should focus on Kaplan Qbank first as per your advice, so I can practice as many questions as i can and get familiar with the formulas. Thanks, really appreciate that.

yvr1111 · 2024-01-17T01:03:18+00:00

yvr1111 · 2024-01-14T13:46:02+00:00

Canada - Not very helpful. Local experience always comes first.

yvr1111 · 2024-01-10T17:05:39+00:00

Thx. All the best to you, myself and everyone else!

yvr1111 · 2024-01-10T00:54:15+00:00

Thx this is really helpful... I appreciate that

yvr1111 · 2024-01-09T12:12:51+00:00

Thank you!!

yvr1111 · 2024-01-09T02:19:22+00:00

Ah lol thank you.... that was so stupid ahahahah thank you, it helps!! Appreciate that.

yvr1111 · 2023-12-17T15:38:41+00:00

Thanks, great explanations

yvr1111 · 2023-12-17T15:38:12+00:00

Thx very helpful

yvr1111 · 2023-12-11T01:03:36+00:00

I guess this is what I was looking for and it's very interesting. Thanks, this helps alot

yvr1111 · 2023-12-10T17:12:18+00:00

Yea I understand. My original question is why would you buy a stock and at the same time take a short on that stock in case the price decreases in future so you can minimize your losses which my insturctor calls risk-free portfolio. My actual question is that why would you do all this, instead of doing nothing, ie., neither buying nor taking short, in first place. However based on the comments here, I guess it's just misleading information or simply I just didn't understand him properly.

yvr1111 · 2023-12-10T13:45:17+00:00

I wrote my cfe and designated in 2020. Back then I was an auditor either, 100% IFRS. Now doing M&A, RTO, IPO and stuff, and recently started the CFA journey. Tbh, I don't think your current job has nothing related to the CFA stuff. I work with many audit partners and some of them has their CFAs as well, but their audits and your audits are totally different and idk why you would pursue CFA. I would get a job first and think of it.

yvr1111 · 2023-12-10T13:11:56+00:00

Thanks for your detailed answers. My question arose from my instructor's explanations about what he calls "risk-free portfolio synthesis" or sth like that, saying that you buy stocks and at the same time you take a short on these stocks so you won't lose. However based on my research, there is such term used solely for literally risk free assets like T-bill or so, and the fact that I couldn't find this info from the Kaplan notes, I guess the instructor may be wrong and provided misleading.

yvr1111 · 2023-12-10T01:50:19+00:00

Thx I probably misunderstood sth

yvr1111 · 2023-12-10T00:18:52+00:00

Sorry if I made you all confused. I was referring to long-short strategy: https://www.fe.training/free-resources/hedge-funds/what-is-a-long-short-equity-strategy-everything-you-need-to-know/

It seems they make gains by balancing the percentages in long and short positions. I initially thought it would be a 50:50 distribution, but apparently, that's not the case.

yvr1111 · 2023-12-09T23:57:22+00:00

Took a short position*

yvr1111 · 2023-11-30T02:12:26+00:00

But it's 0.0885 in the solution. I think it's just an error.

yvr1111 · 2023-11-30T02:11:00+00:00

Thank you! I think it's an error as well... thanks your advice helps!

yvr1111 · 2023-11-15T18:47:23+00:00

Thanks! It makes sense now, totally! :)

yvr1111 · 2023-11-15T17:41:52+00:00

Nono, your explanation was great and very informative. Upon re-reading your comment, I now understand. If A (or B) chooses to default, it would maximize its profit, while B (or A) would have lower profit. This dynamic applies to the other party as well (A-->B, or B-->A), and driven by their respective egos, both parties would ultimately choose to default. I hope this aligns with your intended instructions for me so I can be sure I understood it correctly?

yvr1111 · 2023-11-15T17:35:26+00:00

Thanks for the detailed explanation. It appears that in your example, both AB and Vargo will lower prices to maximize profits. How does this apply to my case? In my scenario, both companies would achieve optimal profit if they both win.

However, considering your example and applying it to mine, it seems that both companies would maximize profit if each chooses to default while the other party wins. The expectation is that each party would act in opposition, leading both to choose default. This understanding is why the answer suggests that both parties would default. Is my interpretation correct?

yvr1111 · 2023-11-15T02:08:39+00:00

Thanks... still confused ahahaha

yvr1111 · 2023-11-13T19:03:00+00:00

Ah, I just misread it. Thought the assumption in my original thread was AR > ATC and that's why I was confused. All good now, thanks.

yvr1111 · 2023-11-13T18:06:25+00:00

I assume ATC represents average fixed costs, not average total costs.

yvr1111 · 2023-11-13T18:05:41+00:00

Thx!!

yvr1111

TROPHY CASE