Monday, May 6, 2013

Reading 35

I have finally finished studying Reading 35 on price multiples. It is quite a long reading, and the video lecture I watched was long as well (of course).

The reading itself is not that hard. I think the main thing to remember is the way to find the justified price multiples. (e.g. the justified P/E based on fundamentals is D0(1+g)/r-g.). If you can remember those, then you know most of the reading. Peter Olinto says that because these come up in other readings (within equity), there is a high chance these will be tested.

I highly recommend watching the lecture videos, because he explains things very well, and repeats the concepts. This helps cement the knowledge into your brain. It's also a different way of learning (from reading the curriculum) which is good for your brain.

There is less than one month to go until the June 2013 exams. If you are sitting these exams, I hope you have almost finished your main study, and are starting revision now. This last month is the most intense time and the most important. Trust me, the feeling when you pass will be worth it. Good luck and go hard!

25 days until the June 2013 exams.
396 days until the June 2014 exams.   

Wednesday, April 24, 2013

Eliminate Silly Errors!

I was watching Peter Olinto's video on reading 35 when he said something that is very important. He said you should save your wrong answers for the difficult questions, and not use them on silly errors.

I have previously mentioned this here. You need to get 70% to ensure a pass in the exam (this is not guaranteed, but you are highly unlikely to fail). This means you need to get  84/120. You don't want to get more than 36 questions wrong. You do not want to use any of those questions for things you know. If you don't read the question properly, or use a formula slightly wrong, then you may blow one of those lifelines.

One thing you can do to eliminate these errors is write equations out before you use them. That way, you can look at it, and make sure it's correct before using it. It does not take long to do that, and it can save you a point for a question you have no clue about how to answer.

Does anyone else have any tips to minimise silly errors? Please let me know because I hate to make those mistakes, and don't want to anymore.

407 days until the level 2 exam.

Tuesday, April 23, 2013

Diet and Exercise

The CFA exam is six hours long, split into two three hour sessions in one day. It is like a marathon. It is quite hard to stay completely focused for those six hours. I remember when I sat the exam, I struggled with the last half of the PM session. My brain did not want to think anymore.. It took me longer to recall information, and I had doubts if over what the question was asking..

While your exam study is the most crucial part to passing the exams, diet and exercise is also important leading up to the exam. It will help get you through the day, and your concentration wont fade.

I'm not saying you have to be a fitness freak, or a health nut. If you exercise for three times a week for at least half an hour (whether it's walking down the street, or running up a hill with a sandbag), it will help you in so many ways. Your study sessions will benefit from this.

Eating healthy does not mean you have to go on a diet, and not eat any junk food.. If you limit your intake of junk food to once or twice a week, and eat lots of fruit and vegetables everyday, it will help your brain functions immensely. Also, drink lots of water (instead of coke or red bull).

It's also important to get a decent amount of sleep each night. Who knows.. you might have dreams about sitting the exam! (I have..)

The exam is just over one month away, so now is the perfect time to start eating healthy, and exercise. When June 1st comes around, your mind and body will be in perfect shape for the exam, and you will last the whole day without getting tired, or losing concentration.

409 days (or 40) days until the level 2 exam.

Sunday, April 21, 2013

Study Plan

I have mentioned earlier that I plan on studying for around one hour per day. Half an hour is dedicated to revision of material I have already studied, and the other half an hour is for learning new material. I am going to let you know my study plan in detail for this post.

I am basing my study plan on Allen Resources exam strategy. I am starting with Equity, and will continue with their order of studying. I am reading through the CFA curriculum to learn the new material.

Once I finish a reading, I watch the lecture video's on Elan guides to make sure I understand everything before moving on. Then I do the questions in the curriculum to finish off the reading.

Every morning, I do a set of questions on finquiz. I choose the questions from readings I have already covered, and this is part of my revision. These questions are quite easy, but good for keeping the concepts fresh in my head.

I have the Allen Resources question bank on my tablet, and I will use this to do the mini-exams as they have said you should do. When I run out of questions on finquiz, I will use these for my daily revision as well.

If I can keep up the daily revision, and 1/2 an hour per day of learning new material, I am sure I will be ready to ace the exam next year.

What do you think about this plan? Is it too little? Or too much? How can I improve on it? Let me know..

411 days until the level 2 exam.

Friday, April 19, 2013


One of the tricky things about sitting the CFA exam is remembering everything you study, on the exam day. If you have studied over a six month period, or longer,  recalling the subjects you studied first is challenging.

For me, I'm going to be studying over a 13-14 month period.

I am aiming to study one hour per day. Only half an hour of that is dedicated to studying new material. The other half an hour is reserved for doing practice questions and reviewing notes.

After I have completed a reading, I make flashcards with equations, or short facts which I think are important to remember. Here is an example:

These are quite good to take to work (or anywhere). When I have a break, I use these to see if I remember the concepts. After a while they become second nature to you.

So if you are studying over a long period, you should consider making some flashcards yourself. If you make some for the areas you are having trouble with, you will have less problems after going through these for a couple of weeks.

413 days until the level 2 exam.

Tuesday, April 16, 2013

Trust your instincts

 Yesterday I was answering some practice questions when this easy question came up:

The issuance of shares most likely has:
a) a positive effect on FCFE
b) no effect on FCFE
c) a negative effect on FCFE

Answer B immediately popped into my mind as the correct answer. This is a gift right? I should lock that answer in straight away.

Unfortunately I didn't do that.

I usually read through all the answer choices and reread the question to make sure I have selected the right choice. At some point during this process I sometimes end up changing my answer. I change the answer because I think the other choice looks more correct, or I think I left something out of my equation and need to redo it.

When I have changed my answer, it is usually from the right answer to the wrong answer.

In this case, I changed my answer from 'B' to 'A' :(

There is nothing wrong with changing your answer if you are 100% sure you are changing it to the correct one. But you should be very careful about doing this because there is a reason why your first choice stood out. You need to have a very good reason to change it from this..

This will usually apply to ethics or theory based questions, but it can also happen with mathematical based questions to, so be careful.

Another reason why you should trust your instincts is time. You don't have time during the exam to double check all your questions. If you finish early and have time at the end, then you can look at the questions you were not so sure about..

Have you ever had this experience yourself? I think it happens more often than you think..

416 days until the level 2 exam.

Monday, April 15, 2013

Starting Over

I have not updated this blog for a long time. The reason is I failed the level II exam again in June 2011. I took a break in 2012 because I needed it.

I decided to sit the exam again in June 2013, but I don't think I am going to pass it based on how much I have prepared for it so far.

I will still sit the exam, but I don't have high hopes in passing. Instead, I am focused on sitting the exam in June 2014, and will do the best I can to pass. I will not be aiming for the bare minimum pass. I am aiming to pass comfortably.

I think this is for the best. I was looking back at my previous blog posts, and realised I did not start my study early enough. I am busier with work compared to a couple of years ago, and I need to take that into account. Starting now gives me plenty of time to cover all the material and memorise it.

There are two cons I can think of to starting so early.. When exam time comes along, there's a chance I wont remember the material I have studied a year ago. To counter this, I am doing review questions everyday to keep the material fresh in my mind. I am also making flash cards which I will look at during my breaks at work.

The second con is that the material could change between 2013 and 2014. That does not bother me so much because I can always review the new material when it is released.

2014 will be the fifth time I will sit the level II exam!! When I started this blog, my goal was to pass all three exams on the first attempt. That has not happened, but it has not deterred me from obtaining the charter.

Hopefully the fifth time is a charm for me.

417 days until the 2014 level two exam.