CFA CFA Level 3 How is “Capital Market Expectations” reading tested

How is “Capital Market Expectations” reading tested

  • This topic has 10 replies, 8 voices, and was last updated Sep-17 by fabian.
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  • RaviVooda
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    How is “Capital Market Expectations” reading tested as part of the exam?

    bceagles
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    I was just wondering the same thing as parts of the chapter seem very calculation based but the command word is “demonstrate”. Anyone have any thoughts on this?

    RaviVooda
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    I think they might club along with some portfolio management questions.

    @sophie
    ,@jwa,@alta12,@marc.. your views please

    Alta12
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    @raviVooda I’m not taking any guess. Anything is possible.

    AjFinance
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    @RaviVooda It would usually be clubbed along with other PM questions. At level 3, like they repeatedly mention in the notes, its more about linking the concepts together rather than isolating different topics.

    Jwa
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    @RaviVooda Many, many ways – woven into other areas, or specific questions given tables of data, including applying Taylor Rule, Yardeni, H-model etc. If you just look at the all the practice problems in the books, you can see it can come at you from many angles.

    RaviVooda
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    @Jwa, @AjFinance‌ THanks guys. This is in one way scary. Need to practice a lot

    Marc
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    Based on past years, it is virtually certain CME will be tested in the morning session this year.

    I would specifically be prepared for:
    – Grinold-Kroner
    – Singer-Terhaar
    – Taylor Rule
    – Exchange rate forecasting
    – Some sort of qualitative discussion of the business cycle.

    RaviVooda
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    Thanks @Marc

    Betankrich
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    Capital Market is a tough beast. My Recommendation would be to read through – Forecasting and Forecasting tools, In statistical tools. I would like – Excess corporate growth , Grinold and Kroner model, Singer and Tehaar ICAPM for quantitative questions. You should also pay very close attention to business cycle analysis, Inflation and recession topics. Trend growth components and economic metric tools are also CFA favourites. I would also like to read co relation of currency inflow and outflow with business cycles. Hope it helps

    fabian
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    Thanks @Betankrich‌!

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