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This is an evolving post of useful CFA topics discussions for Level I. As new and awesome discussions are created, I will be continually adding them here to create a quick reference guide for Level I members to dive straight in!
Topic Area Topic Description General Changes in Level I from 2012 to 2013 @TacheMan shares his findings on syllabus changes from 2012 to 2013. General Easiest CFA Topics @Diya asks everyone which topics they love in Level I. General EOC Questions are harder/easier than the actual exam? @Nabeel looks at end-of-chapter questions from CFAI. General Hardest CFA Topics @hairyfairy ponders the toughest topics in Level I. General Level 1 exam prep, weightings by study readings @mitch895 looks at L1 topic weightings. General NPV/IRR Calculator Questions @CFA_redemption_12713 goes through a NPV/IRR question. General Test Prep and Test Day practical tips @channing_cox shares test-day and test-taking tips. General You Passed Level 1. What Do You Wish You Knew? @lulu123 finds out from past exam takers what they wish they knew beforehand. Derivatives Margin calls: futures vs equities @KawiGreen asks – what are the differences between equity and future margin calls? Derivatives Option Pricing @SidMenon helps clarify the relationship between an option’s exercise price and its relative value. Derivatives Swap Markets and Contracts @SidMenon asks how an interest rate swap can be used to hedge an interest rate risk. Economics Labor, capital and technology @ajost14 looks at the relationship between all 3 economic factors. Economics Price Ceilings @AJFinance clarifies when does a price ceiling become effective. Economics Problem with a question from Q-Bank @Chevalier investigates an example of trades between countries. Economics Short Selling and Market Efficiency @sidmenon finds out why prohibition of short selling creates market inefficiency. Equity Diluted EPS – Mock Exam Question – Why is my answer wrong? @ajost14 goes through a question on diluted EPS. Equity Question on Reading 49 (Equity Securities) @edulima asks a question about common shareholders and differences with preferred shareholders. Equity Sustainable Growth Rate @lulu123 walks through a sustainable growth rate exam question. Equity Valuing a preferred stock @lulu123 values a preferred stock. Ethics Composite vs Mutual Funds in GIPS @bendujamin asks if mutual funds and composites get the same treatment in GIPS. Ethics Ethics: material non public vs independent and objectivity @aanchalb goes through an Ethics question with some confusing answer options. FRA Accelerated Depreciation as a Tax Shield How does accelerated depreciation acts as a tax shield? @TacheMan investigates. FRA Calculation of Equity for ROE What numbers do you use from the balance sheet? @sidmenon investigates. FRA Deferred Tax Assets and Deferred Tax Liabilities Struggling with understanding both? @Maroon5 helps clarify this. FRA FIFO/LIFO @Snippy asks if we should use conceptual or calculation approaches when assessing some LIFO/FIFO differences questions. FRA Financial Leverage Factors How does issuing common stock influence financial leverage? @policedog goes through the reasoning. FRA FRA – Dilutive securities @Snippy goes through a question on dilutive securities. FRA How do one account for warrants emission in the balance sheet? @huwabara asks ‘On the asset side, we add the proceeds to the cash. On the liability side, what do we do?’ FRA IFRS vs GAAP for Level-1 @RaviVooda shares his key learnings on IFRS vs GAAP. FRA Impairment vs EBITDA @huwabara clarifies an issue in FRA FRA Inventory/Sales Ratio @GraemeA asks ‘when inventory/sales is rising or falling, what stage of the business cycle is the economy in?’ FRA Non-controlling Interest, How Does It Work? @Dan ponders the exact definition of non-controlling interest, and how it should be reported in the income statement. FRA Perpetual vs periodic inventory system @lulu123 investigates the effect on COGS and gross margin is for perpetual system vs. periodic system. FRA Revenue, sales, turnover, net income, EBITDA questions @policedog investigates the differences between several terms. FRA Understanding Balance Sheet Revenue Recognition @SidMenon goes through an example and nuances of recognizing different revenue types in the balance sheet. FRA US GAAP & IFRS Differences @Dan helps compile a list of GAAP and IRFS differences in one handy place. Quant Kurtosis Calculations @lulu123 asks if kurtosis calculations are really necessary…? Quant QM – Answer Explanation Re Time Value @GraemeA goes through a time value question. Quant Quantitative Methods – Distribution of Returns Example Question @SidMenon runs through a particularly confusing question. Quant Quants – Impulse Wave and Corrective Wave @Snippy dives into the Elliot Wave theory. Quant Quants: Study Session 3, LOS 9.i @peekabooitsme looks at a uniform distribution question. Quant Settling Kurtosis Once and For All @hairyfairy discusses leptokurtic and platykurtic distributions and why the tails seem counterintuitive. Quant VIX and Contrarian Strategy @lulu123 reconciles her understanding as to why extremely high VIX levels are considered bullish by contrarians. -
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Hi @Sophie, Firstly I want to say that I have seen your posts and comments, they are very impressive.
Secondly, I have been registered into CFA 2 months back and preparing for Level-1 and hopefully will appear in Dec 13 Exams. I’m studying from Sheweser 5 books ONLY and also bought the 2 additional practice books of sheweser as well. I also got its Mocks which i’m planning to do in November. My study way is that after studying each reading, I’m doing the exercises at the end of each chapter (of Sheweser book).
I want to ask you that:1) can I get the Real/Actual past exam papers of CFA Level-1 from anywhere? because I want to practice the real exam style as I find Sheweser questions a lot easier so I feel that they mayn’t be reflecting the difficulty level of the real exam paper
2) As u have been through to that level-1 paper, so do you see any practice material that reflects or close to the difficulty level of the real exam paper. IF yes, Please tell me.Regards,
Arslan -
Hi @Arslan, it sounds like you’re doing well, do give Dec 13 a go for sure. I relied on Schweser notes and practice papers exclusively as well and it seems to work.
I’m not sure if you can get past CFA level 1 papers. Don’t worry about this, the mock you’ll get in November is quite a good representative of the level of difficulty. You’ll find that Schweser tends to be more calculation focused (which some find easy), but the actual exams can be more ‘wordy’ and somehow throw people of. So there are of equal ‘difficulty’, but of course practicing makes things easier, and I’d use the mock paper as a benchmark.
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@sophie I like calculations more than the wordy questions but yes I’m preparing myself for both type of questions by grabbing the concepts from sheweser. The most difficult thing i’m finding these days is “The Retention of things”. There are so many tiny tiny things to memorize which is a tough part of CFA for me. However revising things after some gap is helping a bit. Apart from that, my ACCA background (with P4 passed) and A-levels economics + statistics is helping a lot, so yeah lets see how it goes. Thanks for the prompt reply.
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@Sophie, @christine, @Zee
thanks for making future CFA takers’ lives easier ^:)^ -
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@sophie
Hi, I’m doing ACCA and planning to join CFA. However I have some reservations, which i want to clear up before starting.Firstly, I have heard that CFA doesn’t have much scope in today’s markets. Here in our country (Pakistan) many CFA’s (all 3 levels passed) didn’t get proper job. Additionally, I want to move to Middle East or U.S but seniors say that it isn’t well known in Middle East Market and doesn’t pay in comparison to your efforts you do in passing CFA. In US Market, CPA has overshadowed CFA, so I want to know how true is that?
Secondly, I’m having a lot of problems in getting a proper job even though I’m at my final stages of my ACCA and our board is just not co-operating much. I heard that CFA is very difficult to pass so I want to know how much the CFA Board helps their students who pass Level-1 or Level-2, in getting the job?
Your advices will help me in taking my decision.
Best Regards,
Shams -
Please consider opening a new thread for discussion as your questions warrants it.
In US Market, CPA has overshadowed CFA …
Its like saying dentists have overshadowed heart surgeons., sorry no pun intended …
That is not possible for simple reason that they have very different role to play and both are required by organisations. I terms of volume of jobs it may be true but then as they are two different career all together, I don’t think we can compare them fairly.
This may help you:
http://www.investopedia.com/articles/professionaleducation/08/cfa-cpa-cfp-how-to-choose.aspSo first choose your career before certification / charter. As first one decides which way you travel and later decides how fast you can travel 😉
I may be wrong here, but as you are going to qualify ACCA, CPA makes so much more sense than CFA.
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I agree with @shreeneewas here. But first of all, let’s take a step back. It depends what you want to do for a career. If it’s accounting related, ACCA and CPA would be more relevant. If it’s broader like finance, portfolio management, equity research then CFA is more relevant. Both are recognised worldwide, but for different fields. So I’m not sure if we’re comparing apples with apples here @shams.
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It should depend on what you view your future career into. If you want to advance in accounting field, CPA goes good in combination with ACCA. However, if you want to progress in Finance segment, then CFA course is the best option to go for. CFA is one of the most respected and recognized designations among finance professionals around the globe.
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