Who maintains oversight/responsibilty for the Professional Conduct Program?
ANSWER
CFAI Board of Governors
Regarding Record Retention..
ANSWER
"must develop and maintain appropriate records to support investment analyses, recom-
mendations and other investment-related communications with clients and prospects"
Do you have to disclose long-standing client relationships?
ANSWER
no
With regards to updating client IPS,
ANSWER
remember: you cannot make investments until it is updated (loyalty, prudence and care)
empirical data
ANSWER
estimated from data as a relative frequency of occurrence
priori prob.
ANSWER
1
, based on logic
the arithmetic sum of deviations around the mean will always equal
ANSWER
zero (not one!)
MAD will always be
ANSWER
less than or equal to the std. deviation
why are binomial trees worked backward?
ANSWER
to get the expected value as of today
bollinger bands
ANSWER
become wider with more price volatility
economic profit formula =
ANSWER
accounting profit - total implicity opportunity costs
accounting profit =
ANSWER
total rev - total VC - total FC
total opportunity costs formula =
2
ANSWER
CFAI Board of Governors
Regarding Record Retention..
ANSWER
"must develop and maintain appropriate records to support investment analyses, recom-
mendations and other investment-related communications with clients and prospects"
Do you have to disclose long-standing client relationships?
ANSWER
no
With regards to updating client IPS,
ANSWER
remember: you cannot make investments until it is updated (loyalty, prudence and care)
empirical data
ANSWER
estimated from data as a relative frequency of occurrence
priori prob.
ANSWER
1
, based on logic
the arithmetic sum of deviations around the mean will always equal
ANSWER
zero (not one!)
MAD will always be
ANSWER
less than or equal to the std. deviation
why are binomial trees worked backward?
ANSWER
to get the expected value as of today
bollinger bands
ANSWER
become wider with more price volatility
economic profit formula =
ANSWER
accounting profit - total implicity opportunity costs
accounting profit =
ANSWER
total rev - total VC - total FC
total opportunity costs formula =
2
