Hey David !

First, Wish you and yr family a very happy new year !

I saw my results today and it was negative....nothing shocking since the expectation was not really positive......b.t.w.

My Score is :-

Cr Risk - 2nd Quartile
Op Risk - 1st Quartile
Risk Management and Investment Mgmt - 2nd Quartile
Market Risk - 4th Quartile
Quantitative Analysis - 3rd Quartile

So, it was mainly due to Market Risk and Quant Analysis why I could not make it....

David, please let me know what do i need to do in order to continue a member of your resources for FRM 2008 ?…

Awaiting your reply…

Thanks indeed for yr effort and yr well-drafted notes n movies…

Regards....Chintan

Hi Chintan,

Sorry for the result…

I switched your status to FRM 2008 - so you don’t have to do anything: I value both your contribution to this forum (i.e., your posts to the forum are beneficial for all) and your open-ness regarding the exam.

It contributes to our improvement!

Thanks, David

Chintan,

See previous message re: status

1. You are getting the early bird email, yes? Sent Monday, next this Monday and so on...the first thing is to do these practice questions. For the early bird, I am deliberating scanning the exam(s) and crafting FEWER but TOUGHER, RELEVANT practice questions. The Early bird will be more quant but when we kick into to regular gear (i.e., when I see the Market Risk LOs), our emphasis will include doing practice questions right away...I think this will be key: a well-crafted question has a way of reinforcing several ideas at once…

2. I would be interest in your feedback about what works best or not. For example, I personally find the most powerful way to prepare is my spreadsheet builds. To tell the truth, the main way i have learned these concepts myself is to build a spreadsheet (not for all things, of course, much is qualitative). But, like when I first saw the introduction of marginal VaR to exam, I was fuzzy about its relationship to beta. So, I did the spreadsheet that I have elsewhere shared. For me, there was no escaping a concrete understanding this way. Now this is just me; I can tell that some do not use the spreadsheets at all. But i still think that “quantitative risk” is arguably about model building (but of course that is not an excuse to fall blindly “in love” with models; that’s why I like Kevin Dowd’s assigned Market Risk reading, it is about the limits; Paul Wilmott is blogging about this currently). The thing about a spreadsheet, versus reading a book, is you have to engage a bit, it seems like a higher level of learning. So, my spreadsheet tip is offered but i recognize styles vary…

3. For market risk, as you know, a lot of this is equities (Hull) and fixed income (Tuckman but I have it good suspicion that we may see Fabozzi replace Tuckman, which will be terrific). Any time spent reading either/both the JOHN HULL and/or the JORION 3rd Edition VAR book are time well spent, in this regard. Re fixed income, if you feel like making a book investment, here is my recommendation: the CFA Institute recently published Fixed Income Analysis by Frank Fabozzi, 2nd Edition (sorry i don’t have link handy). It is an awesome Fixed Income primer, it is a superset of 2007 FRM FI material, and it (in my view) exceeds the Tuckman material.

4. Again, please let me know, here if you like, how you think we can improve the 2008 FRM program here at BT (aside from more of an emphasis on practice questions).

Thanks, David

Thanks a ton for your prompt and positive response. I’ll drop in suggestions as and when I get some.

Thanking you again....

Regards,
Chintan

Hi David,
I am trying to do a transaction using PayPal. For that I needed to register my credit card into PayPal and its told me to go through some “extended use” for which they charged me about 2$. That was fine! but then now they are telling to get a 4 digit number along with the credit card statement generated for the above transaction for proceeding with this course fees payment. Thats too much for me! I can’t wait so long. The paypay way is not good or may be I havent done proper usage. Anyways I am coming your way!

Hi David !

Thanks for yr feedback on preparation for Mrkt Risk....I really need to focus a lot on Fixed Income.....

B.t.w my plan is to start of, is this way :-

Before GARP comes out with AIMS, I want to -

1) Prepare for Quant Stuff with you.....Early Bird Preps....
2) Focus on weak areas in Market Risk (from FRM 2007 syllabi) by studying the reco. readings - I will buy Fixed Income Analysis by Frank Fabozzi, 2nd Edition....since Fixed Income has been a nightmare…

So this should get over by May for sure with thorough revision !

I think this should be of immense help to me....

Please let me know if anything more can be done before GARP publishes AIMS.....??

Further, about suggestions....I have these, as of now.....

1) Questions....Well, its really nice to have questions accompanying LO’s (AIMS)....it enables the candidate to strengthen the concepts / understanding.....

However, when it comes to a day where there are many questions and then identifying as to which LO is applicable / relevant, becomes a challenge.......this is further aggravated given to understand the time limitation....

Thus, in order to address this, a great way would be to conduct a full-fledged exam with “REAL ENVIRONMENT” - meaning -with time limitation and also with the same level of difficulty.....

If such an exam is conducted in First week of Oct then the candidate will know their weak areas…

Thus, to have difficult question with LO’s / AIMS is great indeed and in addition to this, having a live test in 2 parts with 70 q’s each with time limitation will work terrific......

Can you please study on the feasibility aspect for this suggestion ?

2) A section of Errata where any mistakes pointed out by candidates will be posted here for the benefit of all....

3) I noticed that you do give your opinions about wat is really important (LO’s / AIMS) from exam standpoint. If all such (perceived to be important) LO’s / AIMS are separately shown under a particular place on yr portal then I guess it will work great ...like a laser approach for doing the last minute revision.

I think all these things coupled with the existing great stuff will be a kinda ultimate thing, a candidate can expect…

Thanks indeed…
Chintan

Chintan,

Thank you very so much for taking the time to respond with feedback!

GARP will soon inform us course providers about their 2008 FRM plans, so if I learn anything that impacts an early Quant/Market risk focus, I will post here…

Your suggestion #2: Good idea, we will do this!

Your suggestion #3: I love this idea because, as you know, I believe there are key clusters of knowledge. Yes, I will do this!

Your suggestion #1: Right, I understand this is wanted, I will have someone look into. Of course, it can be done, so I will probably have the quiz application modified for the feature (a simulated test with analytical result). Okay, so i can’t promise yet, but I think this is a good idea…

Thanks again Chintan for giving feedback, it is most important to me...David

Hi David,

GARP has come out with study guide for FRM 2008. Grossly, it looks the same like FRM 2007 study guide and I could barely find any difference.

For the quant, the schaum’s series (Speigel) has been replaced by Damodar Gujarati - Essentials of Econometrics. Tuckman still remains on the study guide.

Please let me know yr thoughts on the best way to prepare for the exam for sure-shot success.

Thanks in advance, as always....

Chintan

Hi Chintan,

(I’ll send out information soon on an overview webinar, etc)

I agree with you: grossly it is similar in content and volume to the 2007 exam. For what it’s worth, I’ve been taking some notes and here my initial observations are below.

I. Quant
Dropped Extreme value theory (EVT) reading (barely included in Wilmott).
Collapsed volatilty from essentially three readings down to one.
Statistics: Spiegel replaced with Gujarati. Similar but MULTIPLE REGRESSION is added.
Added Wilmott for VaR (a short chapter that is subsumed by others mostly the Jorion)

II. Market Risk
Essentially the same as last year (excepted they dropped Allen’s chapters and Tuckman’s MBS chapter)

III. Credit Risk
This module generally EXPANDS with additional material (minus three Meissner credit derivative readings & two credit portfolio readings).
Added: securitization of subprime, Hull’s credit derivatives (Chapter 13), and THREE CHAPTERS form Ong’s Internal Credit Risk Models
Net effect is about the same emphasis on credit derivatives but additional tilt on credit portfolios

IV. Operational Risk
Drops two readings and adds three readings = one additional reading.
New: LDA, operational VaR & Basel II OpRisk

IV. Basel
Same readings EXCEPT they dropped the truly excellent Saidenberg Schuermann (?), which is a great intro to Basel

V. Investment Risk:
About the same amount of material but notable shift in mix.
Dropped the Amaranth case (apparently it is out entirely)
Dropped two fixed income readings: fixed income (performance attribution) barely appears, or does not appear, in the new module
Traditional multi-factor models dropped in favor of two Andrew Lo readings on trendier topics (HF replication and the quant failures)