FRM PART 2 Exam - may 2011

[Harel]

the issue with the question is that the formula assumes that the volatility of the spread is not stochastic (i.e., constant). In time of stress, when the liquidity drains out of the market, the spread is extremely volatile, therefore the formula should be LC=Spread/2(mu+k*sigma)

Just my 2cts

 

[Jiew Kwang]

@braxxus: thanks for your candid sharing. i was wondering what background do you come from in terms of educational / work. I am just 1 year old in finance and a quick look at the materials in part 2, i found that there is indeed much time i require to put into in terms of seriously understanding the subject.

1 observation i found is that there are 80 questions compared to 100 in level 1. However, part 2 seems far more dense and in depth as compared to level 1! So I really think perhaps to be safe, there needs to be "over-studying" and accepting that much of what you've studied would not appear in the exams. If anyone can add to how I can better strategize my study efforts for the exams, I would be very grateful! Thanks!

regards,
jiew kwang

 

[braxxus]

To answer your question, I have much more experience than you do in this area i guess. I did an undergraduate degree in ecnoomics and then completed a MBA later. I have been working in risk management for about 4 years now, but I had not dealt with a large number of the topics covered in the exam. Work experience might make you more familiar with a number of things, but it is not necessary. My work knowledge really only came into play for 2-3 questions, so it isn't that much of an advantage.

 

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Just came to know from a friend that there were many questions repeated in this years L2 exam from Nov 2010 L2 exam. I have not seen last year's paper. If someone has solved last year's paper, can you let me know whether this is really the case?

 

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@sharsh:
My memory is far from rocksolid, but I had not the slightest recognition during the last exam in May 2011. In my perception, the Nov 2010 exam was tougher.

 

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@Roel
Good if thats the case, as was a bit concerned that some people who had solved last yr's paper would be at a huge advantage. Good to know that its still a level playing field