Module 39.5: Valuing FRAs
Price vs Value of Forward Contracts First we look at the difference between the price of the forward contract and …
Module 35.1-35.3, 36.2 Binomial Pricing Models, including Option Bonds
How to use a binomial interest rate tree to find bond prices One method that we use to value bonds …
Module 34.5: Traditional term structure theories
Forward Rate Model The forward rate model allows us to derive a future spot rate from the current spot rate …
CFA Level II: Equity Valuation – FCFF and FCFE Concepts
FCFF/FCFE Concepts A common equity valuation method is the discounted FCFF or FCFE method. FCFF is free cash flow to …
CFA Level II: Financial Reporting and Analysis – Multinational Operations
Multinational Operations Accounting When corporations do business in multiple countries, often through subsidiaries, there are currency considerations that must take …
CFA Level II: Financial Reporting and Analysis – Defined Benefit Plan
Defined-benefit plan Defined benefit plans are pension plans where the employer promises to make periodic payments to an employee after …
Module 9.2 LOS 9.h (And General Times Series: Instability of Coeffiecients in Time Series Models
Time Series We can use regression models for time series as well. The two basic time series graphs are the …
Module 8.6 -8.9 Quantitative Methods – Common Issues with Regression Testing
Regression Model Assumptions Linear Regression Models operate under the following assumptions: A linear relationship exists between dependent and independent variables …
CFA Level II: Quantitative Methods – ANOVA Part II, Significance Testing
The next concept we will look at is significance testing. Significance testing is a form of hypothesis testing focused on …
CFA Level II: Quantitave Measures – Anova Part I, SST = RSS +SSE
ANOVA Table 1: CFA Anova Model ANOVA is short for analysis of variance. The key concept are sum of squared …