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Fixed Income Basics for L1

Fixed income is a MAJOR section of Level 1 (and L2/L3). This post runs through all the basics presented in SS 15, Reading 51 in the CFA curriculum including the basic structure of a bond, a bond's components and what they all represent, the types of issuers, and highly testable material around tranches and special bond provisions. 

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Breaking down capital budgeting for the CFA L1 Exam

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Comparing Technical and Fundamental Analysis

Throughout each CFA level (but mostly tested in L1) you could come across questions asking you to compare/contrast trading strategies built using technical analysis versus those that depend on fundamental analysis...

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The Origin of the Money Multiplier and its Effect on Monetary Policy

Why is a 14th century banking innovation important for modern monetary policy? This post explores the rise of fractional reserve banking, the money multiplier, and the equations and concepts you should expect to see tested on the CFA Level 1 exam. 

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Solving TVM Problems using your Financial Calculator

On Level 1 you need to be able to solve Time Value of Money problems using your financial calculator. to move between future value and present value. This post includes a straightforward walkthrough of the steps as well as a section highlighting common errors Candidates make. 

 

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The Basics around Global Investment Performance Standards (GIPS)

The global investment performance standards, or GIPS, are a set of voluntary ethical and professional standards for the evaluation and presentation of investment results. On the CFA exams they are a semi-important, boring section that are nonetheless always worth a few points. In this article we summarize the basic objectives and key characteristics of GIPS.

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Monopolistic Competition vs. Perfect Competition in the long run

In the CFA Level 1 Curriculum, monopolistic competition is a short section bridging longer sections talking about Oligopoly and perfect competition. Don't let its length fool you. It's important to know how ALL of the implications of changing the demand curve from flat to downward sloping in terms of firm profits, market reactions, and overall social welfare. 

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Understanding Profit Maximization and Equilibrium in Perfect Competition

In this post we upack the market structure and look at the profit maximizing decisions of individual firms and the long-term equilibrium of the market as a whole under the assumption of perfect competition. 

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Gostudymock3

5 Key Principles for Answering CFA Ethics Questions

Ethics questions can often be ambiguous, with two answers that seem appropriate. When this happens, knowing which questions to ask can help you sort through the different options. Here are three key questions and two guidelines to help you arrive at the right answer.

 

 

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Gostudymock3

Solving Discounted Cash Flow Problems on the CFA L1 Exam

The 5 most important things you need to know in order to answer discounted cash flow problems on the CFA level one exam.

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