Study progress and thoughts

[FAS158]

Anyone doing the ERM/AdFin combo in Fall 2012?

I have started reading the material. Some of it is really abstract and hard to follow. I think the study material on copulas is hard to follow. Another one I had trouble with was the study note on parameter risk.

Would they require us to know the various formulas in the study notes such as formulas for PDFs and CDFs?

I really am not able to ascertain whether I am making any progress in terms of understanding the more abstract material.

Later on, I intend to purchase study manuals and am hoping that would help with the understanding.

[campbell]

Yes, it is entirely possible that they expect you to recall the cdf for the generalized pareto, for example.

Have you taken any other FSA exam before?

[FAS158]

Yes, but not in a while. I only need this combo plus one module to get CERA/FSA combo so am considering it seriously. Back in the days of old, I used JAM study manuals and for earlier exams used Actex. Now the manuals and exam readings look a bit different.

SOA never fails to make the study process unnecessarily abstract. If you read the corresponding CFA and FRM material, they are so well written and organized. SOA just doesnt get it.

[campbell]

Yes, all I will say us that there is a wildly varying quality to the required readings.

As a seminar provider, I thank the E&E committees, but I realize it's not pleasant from the exam-taker perspective.

i have some amount of sympathy, at the FSA level, stuff in the external world keeps changing all the time, and I don't think they can avoid that. Given how few people take these exams in contrast to CFA, they really can't afford to commission full texts for the exams as things change.

I was reading a column by the economist Thomas Sowell recently where he was talking about the textbooks he has written for intro econ .... the text he wrote that was math- and theory-heavy was very easy and quick to write. The one that was more qualitative in its approaches took him ten times as long (of course, it's the second one that has gone on to multiple editions)

For a similar reason profs find it easier to prep for graduate seminars, it's a lot easier to write formula- and theory-heavy papers.

Anyway, at least try to read the less-abstract aspects of the papers, even if the formulas may be a bit opaque. And try to think about testability as well, as you read these. For example, You're not going to be able to do full stochastic simulations on the exams as currently constituted....so what aspects could you actually be tested on?

[PAK]

Originally Posted by FAS158

Anyone doing the ERM/AdFin combo in Fall 2012?

I have started reading the material. Some of it is really abstract and hard to follow. I think the study material on copulas is hard to follow. Another one I had trouble with was the study note on parameter risk.

Would they require us to know the various formulas in the study notes such as formulas for PDFs and CDFs?

I really am not able to ascertain whether I am making any progress in terms of understanding the more abstract material.

Later on, I intend to purchase study manuals and am hoping that would help with the understanding.

Copulas are a difficult concept, but for those who attended my seminar, they know what the copulas are (when I drew an interesting graph).

Unfortunately, you need to know the components (variables) inside the formulas. They may ask you to define the variables, explain how they (formulas and variables) can be used, or give you a new (but similar) formula and ask you to compare them.

Usually the exam question will give you the difficult formulas so you do not need to memorize them. However, you do need to know what they are, and what they mean.

Should you have any questions about this exam (e.g. how to prepare for the exam, etc), please feel free to contact me. Thanks!

[campbell]

Oh, and for copulas (and some of the other more complicated quantitative concepts), I provide spreadsheets for you to explore the concepts.

Yes, they're not going to ask questions that require spreadsheets on the exams, but I think when people can fiddle around with the innards, they understand it better.

[PAK]

Correct! Practice makes perfect. There are many practice questions and spreadsheet explanations in the PAK Study Manual Package to explain/test the difficult quantitative concepts.

[FAS158]

Thanks guys. I am feeling good that I started early. Also, I am familiar with many readings because have been in a risk role for a while. I appreciate your help!

[campbell]

Definitely true that having actual work experience does help with regards to understanding the readings.

Best wishes!

[PAK]

Originally Posted by FAS158

Thanks guys. I am feeling good that I started early. Also, I am familiar with many readings because have been in a risk role for a while. I appreciate your help!

Yes, that helps a lot.