Table of Contents
Cover
Volume 1
Title Page
Copyright Page
Contents
Study Session 1: Ethical and Professional Standards
Reading 1: Code of Ethics and Standards of Professional Conduct
LESSON 1: CODE OF ETHICS AND STANDARDS OF PROFESSIONAL CONDUCT
CFA Institute Professional Conduct Program
Adoption of the Code and Standards
Why Ethics Matters
CFA INSTITUTE CODE OF ETHICS AND STANDARDS OF PROFESSIONAL CONDUCT
Preamble
The Code of Ethics
Standards of Professional Conduct
Reading 2: Guidance for Standards I‐VII
LESSON 1: STANDARD I: PROFESSIONALISM
Standard I(A): Knowledge of the Law
Standard I(B) Independence and Objectivity
Standard I(C) Misrepresentation
Standard I(D) Misconduct
LESSON 2: STANDARD II: INTEGRITY OF CAPITAL MARKETS
Standard II(A) Material Nonpublic Information
Standard II(B) Market Manipulation
LESSON 3: STANDARD III: DUTIES TO CLIENTS
Standard III(A) Loyalty, Prudence, and Care
Standard III(B) Fair Dealing
Standard III(C) Suitability
Standard III(D) Performance Presentation
Standard III(E) Preservation of Confidentiality
LESSON 4: STANDARD IV: DUTIES TO EMPLOTERS
Standard IV(A) Loyalty
Standard IV(B) Additional Compensation Arrangements
Standard IV(C) Responsibilities of Supervisors
LESSON 5: STANDARD V: INVESTMENT ANALYSIS, RECOMMENDATIONS AND ACTION
Standard V(A) Diligence and Reasonable Basis
Standard V(B) Communication with Clients and Prospective Clients
Standard V(C) Record Retention
LESSON 6: STANDARD VI: CONFLICTS OF INTEREST
Standard VI(A) Disclosure of Conflicts
Standard VI(B) Priority of Transactions
Standard VI(C) Referral Fees
LESSON 7: STANDARD VII: RESPONSIBILITIES AS A CFA INSTITUTE MEMBER OR CFA CANDIDATE
Standard VII(A) Conduct as Participants in CFA Institute Programs
Standard VII(B) Reference to CFA Institute, the CFA Designation, and the CFA Program
Reading 3: Introduction to the Global Investment Performance Standards (GIPS®)
LESSON 1: INTRODUCTION TO THE GLOBAL INVESTMENT PERFORMANCE STANDARDS (GIPS)
The Structure of the GIPS Standards
Reading 4: Global Investment Performance Standards (GIPS®)
LESSON 1: GLOBAL INVESTMENT PERFORMANCE STANDARDS (GIPS)
Fundamentals of Compliance
Study Session 2: Quantitative Methods—Basic Concepts
Reading 5: The Time Value of Money
LESSON 1: INTRODUCTION, INTEREST RATES, FUTURE VALUE AND PRESNT VALUE
The Financial Calculator
Timelines
Sign Convention
The Future Value of a Single Cash Flow
The Present Value of a Single Cash Flow
FV and PV of a Series of Cash Flows
Present Value of a Perpetuity
Present and Future Value of Unequal Cash Flows
LESSON 2: STATED ANNUAL INTEREST RATES, COMPOUNDING FREQUENCY, EFFECTIVE ANNUAL RATES AND ILLUSTRATIONS OF TVM PROBLEMS
The Frequency of Compounding
Loan Payments and Amortization
The Cash Flow Additivity Principle
Reading 6: Discounted Cash Flow Applications
LESSON 1: NET PRESENT VALUE AND INTERNAL RATE OF RETURN
Internal Rate of Return (IRR)
LESSON 2: PORTFOLIO RETURN MEASUREMENT
LESSON 3: MONEY MARKET YIELDS
Market Yields
Bond Equivalent Yield
Reading 7: Statistical Concepts and Market Returns
LESSON 1: FUNDAMENTAL CONCEPTS, FREQUENCY DISTRIBUTIONS AND THE GRAPHICAL PRESENTATION OF DATA
Histograms and Frequency Polygons
LESSON 2: MEASURES OF CENTRAL TENDENCY, OTHER MEASURES OF LOCATION (QUANTILES) AND MEASURES OF DISPERSION
Properties of the Arithmetic Mean
Quantiles
Other Concepts of the Mean
Population Variance and Standard Deviation
Sample Variance and Standard Deviation
Issues with the Sharpe Ratio
LESSON 3: SYMMETRY, SKEWNESS AND KURTOSIS IN RETURN DISTRIBUTIONS AND ARITHMETIC VERSUS GEOMETRIC MEANS
Reading 8: Probability Concepts
LESSON 1: PROBABILITY, EXPECTED VALUE AND VARIANCE
Methods of Estimating Probabilities
Profiting from Inconsistent Probabilities
Calculating the Probability that at Least One of Two Events Will Occur
Dependent and Independent Events
Expected Value
Variance and Standard Deviation
LESSON 2: COVARIANCE AND CORRELATION AND CALCULATING PORTFOLIO EXPECTED RETURN AND VARIANCE
Properties of Covariance
Limitations of Covariance
Correlation Coefficient
Properties of the Correlation Coefficient
LESSON 3: TOPICS IN PROBABILITY: BAYES’ FORMULA AND COUNTING RULES
Multiplication Rule of Counting
Labeling Problems
Combinations
Permutations
Study Session 3: Quantitative Methods— Application
Reading 9: Common Probability Distributions
LESSON 1: DISCRETE RANDOM VARIABLES, THE DISCRETE UNIFORM DISTRIBUTION AND THE BINOMIAL DISTRIBUTION
The Binomial Distribution
Binomial Trees
Skewness and the Binomial Distribution
Tracking Error
LESSON 2: CONTINUOUS RANDOM VARIABLES, THE CONTINUOUS UNIFORM DISTRIBUTION, THE NORMAL DISTRIBUTION AND THE LOGNORMAL DISTRIBUTION
Calculating Probabilities Using Z-Scores
LESSON 3: MONTE CARLO SIMULATION
Investment Applications
Limitations
Reading 10: Sampling And Estimation
LESSON 1: SAMPLING, SAMPLING ERROR, AND THE DISTRIBUTION OF THE SAMPLE MEAN
Sampling Error
Sampling Distribution
LESSON 2: POINT AND INTERVAL ESTIMATES OF THE POPULATION MEAN, STUDENT’S T-DISTRIBUTION, SAMPLE SIZE AND BIASES
Types of Biases
Sample-Selection Bias
Look-Ahead Bias
Time-Period Bias
Reading 11: Hypothesis Testing
LESSON 1: INTRODUCTION TO HYPOTHESIS TESTING
One-Tailed versus Two-Tailed Tests
Rejection Rules for Two-Tailed Hypothesis Test
Type I and Type II Errors
Relation Between Confidence Intervals and Hypothesis Tests
LESSON 2: HYPOTHESIS TESTS CONCERNING THE MEAN
Hypothesis Tests Concerning the Mean
Tests Relating to the Mean of Two Populations
Tests for Means when Population Variances are Assumed Equal
Tests for Means when Population Variances are Assumed Unequal
LESSON 3: HYPOTHESIS TESTS CONCERNING THE VARIANCE AND NONPARAMETRIC INFERENCE
Reading 12: Technical Analysis
LESSON 1: TECHNICAL ANALYSIS: DEFINITION AND SCOPE
Principles and Assumptions
Technical Versus Fundamental Analysis
Drawbacks of Technical Analysis
LESSON 2: TECHNICAL ANALYSIS TOOLS: CHARTS, TREND AND CHART PATTERNS
Charts
Reversal Patterns
Continuation Patterns
LESSON 3: TECHNICAL ANALYSIS TOOLS: TECHNICAL INDICATORS AND CYCLES
Price-Based Indicators
Momentum Oscillators
Sentiment Indicators
Flow of Funds Indicators
Cycles
LESSON 4: ELLIOT WAVE THEORY AND INTERMARKET ANALYSIS
Elliott Wave Theory
Intermarket Analysis
