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Hi mastvikas, Here is the brief idea: Q1: Let X the # correct answers, then X ~ binomial with n = 10 (# of questions), p = 1/5 (prob of getting correct answer by just guessing), then you can find the answer by solving 1 - P(X <= 2) = 1 - P(X = 0) - P(X = 1) - P(X = 2) Q2: Similar to the Q1...

LineOfBestFit Sorry for the late response - The advice from the above is absolutely valuable - it will definitely help me to write the work verification. (... once I am back from trip) Not all of my daily task involves risk mgmt techniques, so I plan to highlight my work that is relevant from...

Hi BT Folks, GARP is asking a FRM candidate (who passed P1 and P2 exams) to fill in the following for the two-year employment verification process: We require each candidate to provide at least 4 to 5 sentences on how YOU use financial risk on a daily basis in your job(s) that cover a two...

Passed P2 exam as well - I realize right after the exam that I did not get some CI questions... and this was reflected in my quartile score - 1/1/1/1/2. Could not keep all 1Q's as in P1 exams... Still glad it is over. Again, BT Material + Core readings proved to me the most effective way to...

cqbzxk For the backtest, mean of the exceeds is n*p = 252*0.02 (since it is 98%VaR) and the variance is sqrt(n*p*(1-p)) = sqrt(252*0.02*0.98) so we need to find the biggest x s.t. (x - n*p)/ sqrt(n*p*(1-p)) < 1.96 (95% conf interval, the test is two-tailed) when I calculated this on the...

Market Risk -Implied volatility: Given the skewed (equity) curve, which option is undervalued? -Implied volatility: Similar to above, describe fatness of the right and left tails. -Exotic option: which option has the large negative vega? -Exotic option: Given plain vanilla option...

Hi BT folks who have taken P2 exam today, How was the exam? There were some surprise/cheesy(i.e. minor details) questions, but I think overall difficulty was similar to GARP's practice exams. I think it was a fair exam. Needless to say, I want to repeat saying: BT materials (especially PQs)...

Yes, appreciated if we could see more active activities from BT team... the exam is less than 20 days already... :) RiskNoob

No problem, there were several typos in the reply, most of them are corrected. Also, I saw few AIMs in Malz readings are not included in the current 2013 T6 notes, yes, understandable, the calculations are quite tedious and long. Expect low testability. :) RiskNoob

Just going back to the initial discussion... Actually, I started/finishing Gregory's assigned core readings (week 7 in GARP's reading plan) - David's comment was really helpful to study it efficiently (less than 1 week) while reading entire sections in assigned Gregory readings. In my...

Hi David, BT folks, I am having a bit of trouble understanding default probabilities in two different worlds. My intuition is that real world default probabilities should be `more` than risk-neutral default probabilities due to the CAPM framework (e.g. people usually takes more risk (hence...

goal2013, As for the current issue, the readings are quite interesting (at least for me) and not that difficult compare to other topics in FRM - 1 week would be enough to read all of the readings. There will be around 8 questions (10%) from the current issue in the exam, so it would be...

Again, I really appreciate your dedication for providing quality material for BT customers, and understand the all new materials for 2013 might not be 100% delivered in May due to the high-turnover this year. On the other hand, I also appreciate GARP's decision to provide some up-to-date...

I meant PQ database... not PD. I think I already spent too much time reading huge contents in T6 :confused:

Yes, T7 is an another huge (and dynamic in terms of content) topic which desires a PQ treatment compare to T5 and T6 which we already have a solid PD database. It is great to hear news about Global T7 topic review! I have not read Gregory Chapters yet but I think PQs from Canabarro would handle...

David Harper, CFA, FRM, CIPM Suzanne Evans Hi David, Suzanne, Great! We already have Hull's T6 PQs, but these new PQs from Malz will definitely accompany the new readings in T6. :) Not directly related to this T6 posting, but seems like T7 PQs are created lately. Does this mean we won't...

Yes the Fabozzi spreadsheet was in t5.b rather than t5.d... thanks David! Junmin

Seems like 5.d.4 (not 5.e.1) is the right one (and some of these contents are included in P2.T5.d bundle) I think I found the answer, no worries! RiskNoob

Hi David, Suzanne, T5e.1 spreadsheet is mentioned as a reference from the last video (Fabozzi MBS chapters) in T5 but I could not find it in our BT spreadsheet links - I am wondering where can I find this spreadsheet? Thank you! RiskNoob

Hello FRMStrawberry Probably not, the core reading from GARP is pretty costly... You can always buy the individual chapters (soft copies) from GARP library, including the new T6 chapters for 2013. As for the PQs, you can either go to the PQ forums for individual PQs in each topic (T1~T9), OR...