What financial calculator do I need to get for FRM 2008?

[sridhar]

This is probably answered elsewhere...But I thought I should ask my friends here:--)

I've been using Excel as a calculator when it involves dealing with arithmetic containing "e", CDFs of random variables that are normally distbd etc. (e.g. pricing an option using BS formula.)

I am assuming for the actual exam, I won't have access to Excel. What financial calculator do I need to get -- so that they have all the functions that would be required for answering FRM questions?

 

[David Harper CFA FRM]

sridhar,

you can bring either an HP 12C or a Texas Instruments BA II + (or plus Professional).

you might find this post (about the essential functions) helpful:
http://www.bionicturtle.com/learn/article/texas_instruments_ba_ii_plus_ti_ba_ii_essential_functions_for_the_frm/

and Telon added some helpful advice in the comments. He makes a good point you should get comfortable early with the calculator. Although, for the exam, you only need to use a few function keys

David

 

[sridhar]

Thanks again David....I am on it....BTW, do these calculators also provide statistical functions like NORMSDIST, NORMSINV etc -- for instance to compute option prices using BS formulae...If not, how do we handle this during FRM?

 

[David Harper CFA FRM]

Good deal.

No, calculators (to my knowledge) do not give a way to get these values that, normally, you need the back of a statistics text for (e.g., critical z lookup table)

and the test does not expect you to know (except maybe -1.645 and -2.33). And maybe know the nature of the critical t (students t) such that sweet spot is 2-3 so, if you get high t, you'll can likely reject null.

but generally, test will have to give you a table snippet or give you assumptions, you will not have to conduct NORMSINV(), TTEST() on your own

David

 

[David Harper CFA FRM]

Please note GARP has added two HP calculators to the list of acceptable calculators for FRM 2008:
Hewlett Packard 10B II and Hewlett Packard 20B

David