Is CFA notes relevant for FRM quantitative analysis

[verma.rahul]

David

My roommate is giving CFA level 1 this year. So, I got a peek in study notes sent by CFA institute. To me, Quantitative analysis in Book 1 very relate to FRM syllabus. What would you suggest about it. Do they start from basic, I mean, assuming I do not have any finance background but do have a good mathematical background basically engineering background. Also, can it replace Gujarati or should I study Gujarati core readings for sure ???

Rahul

 

[David Harper CFA FRM]

Hi Rahul,

You have a good point. IMO, the CFA texts are simply excellent. I agree there is much overlap between Sessions 2 & 3 and Gujarati. Normally, I suggest candidates stay "on task" with the assigned readings; the reason is simply due to terminology. For example, in CFA, RSS (regression) = Gujarati's ESS (explained) and Gujarati's RSS (residual) is CFA's SSE (errors). If you were new to the math, you can see why a quant newbie does not need to add this terminology burden (and there are other examples). But, okay, given you have a good mathematical background, you are probably accustomed to this sort of thing, and CFA sessions 2 & 3 are (IMO) highly redundant in substance.

You'd still want to do some mapping, right? in two respects:
1. The CFA sessions may actually be broader, so you'd pickup stuff you don't need
2. You'd still have a few things, at the margin, not in CFA; e.g., as Gujarati is about sampling distributions, I am not sure chi-square distribution is really covered there.

But, assuming you (i) were mindful of terminology difference and (ii) you checked the AIMs for minor gaps in the margin, those CFA sessions I think well cover (and more) the substance of Gujarati 1-8

David

 

[verma.rahul]

Thank you for your prompt response and given clarification.