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Hi @nadaalshahabi Well, for years we asked GARP to genuinely prioritize continuous/discrete, if only for the sake of candidate/EPP convivence, but they just never seemed to care about a strong declaration. Of course you are correct that the practice exam(s) lately advise to “always assume...

Hi @shuffleshoe great feedback, thank you! The reason I prefer R (aside from home bias) is that I'm not a developer or working in a professional production environment. My work is primarily data/statistical analysis (e.g., EDA) and it's just easy to quickly perform analytics. If I were building...

Hi @rohinjain This is another question pattern that created confusion along the way due to GARP's imprecise language. See here for discussion on the 2020 instance of same question (albeit with different inputs https://forum.bionicturtle.com/threads/garp-2020-practice-exam-part-2-q74.23268/ i.e...

Hi @corinne.lieberman21 You are correct: the question asks for the lower bound of a confidence interval such that the two-sided deviate (i.e., 1.96 at 95% confidence) is appropriate, rather than the one-sided 1.645 that would be appropriate if the question were asking a VaR-type (aka, SaR in...

Hi @librosdeholanda We already have dozens (hundreds?) of convexity discussions and illustrations, here is a tag https://forum.bionicturtle.com/tags/convexity/ (you can also search related tags here https://forum.bionicturtle.com/tags/ e.g., we have tags for analytical-convexity...

@mkaabb96 Please don't bump your post to me (I deleted it). This is a forum. You ask, "Can you please guide where I am going wrong in my calculations" but where are your calculations?? It's an optimization problem, here is the XLS at...

Hi @superturtle Your comment is well-placed (ie, in the right location) because the quoted sentence (for which I did not take the time to pull up the note) is a statement about risk-neutral valuation that underling option pricing. You are correct about real-world (aka, physical) probabilities...

HI @Eustice_Langham I moved your post to this thread attached to my above video that addresses the recommended P/Y and C/Y settings (starting at about 12:40 min ... ) and also see prior discussion above. My strong preference is to leave P/Y = C/Y = 1 as discussed above

Sure @superturtle you are correct: at the bottom of page 18, we are incorrect to do that. We're using the (same as above) continuous rates (i.e., 2.25% CC at 1.5 years 2.50% CC @ 2 years) to solve in a formula that assumes they are semi-annual (I think we meant that if they were s.a. rates but...

Ken (@superturtle ) answered here https://forum.bionicturtle.com/threads/t3-08-interest-rates-compound-frequencies.22419/post-88262

Hi @superturtle There is no important difference except compound frequency. Please See below. I quickly prepped an XLS for you (open it here at https://www.dropbox.com/s/lvs9mt3d0yn18a1/2021-04-29-forward-rates.xlsx?dl=0). As discussed on dozens of threads, the forward rate is solving for an...

Hi @Eustice_Langham I had assumed the weighting reflect the actual number of questions, but I admit that I can't recall any verification of that. It would be a good test to see if each of the practice exams comport to this ... sorry I don't know

HI @PJAYAKUMAR I moved your question to general (note for my reference: your question of course refers to https://forum.bionicturtle.com/threads/l2-t5-67-mapping-options-jorion.3638/ ) for later attention, because you are asking me to develop a new topic which is time consuming. About the Greek...

Hi @Uolless Those are correct and easily verified with Excel: NORM.S.DIST(.1783, true) = 0.5708. GARP's 2021 Practice only shows z < 0, so you definitely need to be facile with symmetrical normal's implication that N(z) = 1 - N(-z); in this case N(0.1783) = 1 - N(-0.1783) = 1 - 0.4293 = 0.5708...

Hi @Sameera Yes, I agree with you, and I this it's easiest to understand CVA as an EL designed for the bilateral context. For example, as I wrote here https://forum.bionicturtle.com/threads/credit-var-vs-cva.9563 i.e., ... and then mathematically here at...

Hi @rishivala Right, i mean, setting aside a fact that it appears you already understand power is tricky (ie., this is not the actual power because you conditioned on a true model at 93% b/c that's the best you can do to keep it simple), that's the reason I skipped answering the question: the...

Hi @alexwallace I am also grateful to @nc27 for a terrific answer! :) About your thought process and ED futures, because I have answered variations on the ED dynamic so many times (is why we beg people to search) that I specifically recorded the following two videos: T3-28: Eurodollar futures...

Hi @alexwallace That's a pithy, instructive vignette by GARP, I like it. First, candidates should immediately be able to retrieve the forward rate. As has been discussed on this forum dozens of times, the implied forward rate is based on an indifference idea between: exp(4%*2)*exp(f*1) =...

Hi @rohinjain This question has been analyzed quite a bit due to the confusion it created. The primary problem is GARP's language, but I don't know if they've ever fixed it; see https://forum.bionicturtle.com/threads/garp-2020-p2-53-and-garp-2019-p2-53.22374/post-75487 (and maybe here too...

Hi @gitusrini Yes, on the exam you would need to add them up. That's why my question is more a bit more tedious (sorry!) than you would actually encounter. See https://forum.bionicturtle.com/threads/l2-t5-60-basel-ima-backtest-jorion.3610/post-17011 ie..,