Anyone else unprepared for the December FM test?

[lschmidt]

My school offers a two-semester course sequence that prepares students for exam FM, but I thought I'd be all badass and sit for FM before taking either of the preparatory courses. My school workload has left me with little time to study for FM and I only finished Section 1 of ASM today. I'm not feeling so badass anymore.

Do you have any tips for maximizing my chance of passing? Are there any particular sections of the ASM Manual (9th Ed.) that I should emphasize over others? I am taking the test on Dec 8th so I still have 7 days.

Thanks

[LukeSkywalker]

Your questions can be answered if you flip to page 631 (practice exam 1).

[bdlh]

I think it will be pretty difficult to get enough in before the exam, but I would recommend chapters 3, 4, 9, and going through the DM section quickly. Then start doing as many practice problems as you can. With only 7 days I don't know how effective it will be (you will miss a lot of material and not get much time on what you do see) but that would be my best advice.

Try to really know the formulas for annuities (due and immediate), Increasing/Decreasing annuities, and annuities in geometric progression (with inflation). Also learn how to use the BA II Plus very well.

Good luck, I fell into a similar trap the first time I took FM (emphasis on first).

[STYX Fan]

Annuities, Bonds and DM stuff would be good. However since you only have a week left don't go into the exam thinking that you will pass. If it were me, I would expect to fail, but I'd use the exam as a learning experience to help me prepare for the next sitting.

[Courtney7786]

Originally Posted by lschmidt

My school offers a two-semester course sequence that prepares students for exam FM, but I thought I'd be all badass and sit for FM before taking either of the preparatory courses. My school workload has left me with little time to study for FM and I only finished Section 1 of ASM today. I'm not feeling so badass anymore.

Do you have any tips for maximizing my chance of passing? Are there any particular sections of the ASM Manual (9th Ed.) that I should emphasize over others? I am taking the test on Dec 8th so I still have 7 days.

Thanks

Part two of the manual is not complicated - compared to the first half, it skims the surface of a bunch of topics, but there is little depth.

Read as much of it as you can - know the basics (calls, puts, forwards, the payoffs vs. the profits, put-call parity)... then in the practice exams you will see a few of the more complicated types referenced more than once (collars, bear/bull spreads) There is a nice summary of the types, with pictures of the graphs.

I agree with bdlh thought, make sure you know part 1 really well before spending too much time on part 2.

[lloopy]

Originally Posted by lschmidt

My school offers a two-semester course sequence that prepares students for exam FM, but I thought I'd be all badass and sit for FM before taking either of the preparatory courses. My school workload has left me with little time to study for FM and I only finished Section 1 of ASM today. I'm not feeling so badass anymore.

Do you have any tips for maximizing my chance of passing? Are there any particular sections of the ASM Manual (9th Ed.) that I should emphasize over others? I am taking the test on Dec 8th so I still have 7 days.

Thanks

The good news is that there's not a HUGE amount of material to learn, but the bad news is that you're going to have to do nothing else between now and the exam in order to really have a good chance at knowing it.

For example, in the text, you'll learn about annuities. You'll be given the present value of a payment of 1 given an annual interest of i for n years as a formula. But the actual exam question will ask for the value of the remaining payments after k years, or you'll have payments of 100 for the first 10 years followed by 200 for the next 10 years, or the payments will be twice a year (with interest compounded each year, or each month), so you'll have to know how to handle these various different cases. Get the BAII Plus calculator and know how to use it to find out unknown interest rates.

The financial derivatives are not really all that hard, so you'll get a lot of bang for you buck in reading them and understanding them.

Some questions can be answered with educated guessing, and there's no penalty for using your guessing skills on questions you haven't seen before.

You can still pass, but it's going to take a lot of work on your part.

[Force of Interest]

You have no chance in my opinion. I agree with the post that said use the exam as a learning experience for the next sitting. Sorry to be a downer.

Originally Posted by davidjstratton

You have no chance in my opinion. I agree with the post that said use the exam as a learning experience for the next sitting. Sorry to be a downer.

I wouldn't spend more than an hour on the exam if I were him.

[Sloop John B]

Originally Posted by davidjstratton

You have no chance in my opinion. I agree with the post that said use the exam as a learning experience for the next sitting. Sorry to be a downer.

Agreed. Don't worry about it too much and just do what you can. If I were in your shoes I'd probably just study for finals or something.

[jprep]

If you did pull this off and pass, you would have major bragging rights. But I still think that it's going to be tough, just remember the questions and right after the test, try to solve them with more time while looking at the manuals.

This is reconaissance, with the potential to actually pass the test.