ARRIBA

Week in Financial Education (June 28, 2021)

Welcome to the latest WIFE. For Part 1, we wrote a new set of insurance company practice questions (PQs). I was recently asked how much insurance is assigned in the FRM. Surprisingly little. You might expect insurance to be prevalent in Operational Risk (P2.T7) but it makes but three appearances in all of Part 2.... Read More

Week in Financial Education (June 21, 2021)

Welcome to the latest WIFE. For Part 1, we have a new practice question (PQ) set for the insurance chapter (FMP-2). I have a question about the combined ratio after dividends (CRAD). This CRAD measure is interesting because some sources subtract the dividend, CRAD = CR - D, while others (like GARP) add per CRAD... Read More

Week in Financial Education (June 14, 2021)

Welcome to another WIFE. Last week we added a new practice question (PQ) set for the Insurance chapter (P1.FMP-2) and a new PQ set for the Risk Monitoring chapter (P2.IM-7). Trying to be realistic, for the mortality table, I pulled actual projected 2021 period life tables from the Social Security Administration at https://www.ssa.gov/. We received... Read More

Week in Financial Education (June 7, 2021)

Welcome to another WIFE. We started a new series of practice questions (PQ) for Financial Markets and Products (P1.T3). Question 21.2.1 (Investment banks) reflects my style of packing three concepts (any one of which might be tested) into one question by using the Dutch auction's answer to inform a comparison to the other approaches (best... Read More

Week in Financial Education (May 24, 2021)

In our latest Week in Financial Education (WIFE), Richie's new video helpfully reviews a series of duration questions, including modified, Macaulay, money duration, and price value of basis point (PVBP; aka, PV01). Compared to the FRM, the CFA's approach to duration differs only slightly. The formulas are essentially similar. The CFA's modified duration is analytical (e.g.,... Read More

Week in Financial Education (May 3, 2021)

Hello, welcome to another WIFE! Our FRM forum was super busy last week. I wrote a long reply to the question (link below) about the interpretation of foreign exchange (FX) quotes. We have experience here. This is one of many examples of where we (members in this forum) prompted a correction to GARP's imprecise syntax... Read More

Week in Financial Education (April 19, 2021)

I hope you enjoy my latest time series question set (P1.T2.21.2). It was fun to develop these with actual code snippets. GARP's text (Chapter 11) on the Augmented Dickey-Fuller (ADF) might seem dense to readers, but you'll see that in R we can execute the test with a single function call, adf.test(). As a practical... Read More

Week in Financial Education (April 12, 2021)

I hope you enjoy my latest non-stationary time series (TS) question set (T2.21.1. below). As with the previous TS Q&A, I provided code snippets to add to the realism. For example, you can see how easy it is to determine the (unit root) polynomial roots. In that regard, I considered including a question that requires... Read More

Week in Financial Education (April 5, 2021)

This week we had a interesting question about the definition of duration due to an apparent difference between GARP's new material and Tuckman. It's a good chance to understand the math that underlies this fundamental bond risk measure. In external news, Archegos is a dominant story (and likely future FRM case study). Finally, David mentions... Read More
FRM week in risk

Week in Financial Education (March 29, 2021)

Hello valued visitors! We're bringing back Week in Risk but calling it Our Week in Financial Education until we find a better title. Maybe you noticed our exciting news? We recently joined CeriFi and look forward to broadening this forum's reach. The idea is to share a brief blog-like update from the week including selected forum threads that highlight interesting... Read More
week in risk feature

Bionic Turtle’s Week in Risk – It’s Exam Week!

Welcome to our Week in Risk blog! It's exam week and we hope that everyone feels prepared for Saturday. Remember that our forum provides a great deal of information on the FRM concepts so make sure to stop by with any last-minute questions that you may have. We want to wish everyone good luck on... Read More