Discuss Exam FM, Spring 2007

[admin]

You may start posting after 5 p.m. eastern time on Friday 5/25.

[ml692787]

no dollar weighted time weighted and short sale of stock on exam i was a little upset about that...the new material questions were extremely easy too bad i didnt retain any information from that textbook

[EdKJ]

What did everyone think?

What did everyone think?
There were a lot of concept-testing questions that used too many words and not enough numbers.

Ed

[ml692787]

yeah there were like 4 or 5 straight out word problems i mean i didnt take the 2006 exams but based on 2005 there were only like 2

[JUICE]

There were only two questions of which I was unsure.

The first was the immunization problem, where I believe the object was to have the assets exceed liability in order for the convexity of the former to exceed the latter.

The other was the problem where you were given averages of portfolio and investment year rates and then were asked to derive the new money rate..... can anyone shed some light on this one?

[Rick Ross]

Cntinuous annuities

No continuous annuities, 6-7 questions from derivatives markets.... for the second to last question about new money did anyone get E, 10%?

[JUICE]

E was my guess.

I figured, if anything, I was outthinking myself.

[Rick Ross]

E

Me too, it seemed like the question was too easy

[ml692787]

yeah i think you were just supposed to use the portfolio rate the new money earns the same as the main fund...the main fund is is measured by portfolio rate

[sha6188]

I think you were supposed to use investment method

[Hawgdriver]

That new money rate was the only question that made me stumble, I put 10% as well. At my test center, 3 people left early, and nearly everyone finished early. I hope because this test was easier (it seems) that the passing mark is not abnormally high.

Did you guys put "not enough information available" for the annuity question (#2 I think)? I nearly missed that because I was in a computational frenzy. I went back and noticed they left out annuity-due or annuity-immediate. I wonder if I was the only one to get ''''ered by it.

I wish that MLC was that easy...MLC last week was the inverse. Don't get the wrong idea from this test; SOA/CAS is not getting soft. MLC was twice as hard as FM was easy. Word to the wise.

A lot of investment year/portfolio method questions...but no asset/liability matching...interesting.

I hope everyone felt good about that one!! I do!! I needed that after MLC/MFE!!

[dburack]

For the one with immunization, none of the options mentioned matching the present value so I wrote none of the above. What does everyone else think??

[dburack]

Yeah, it didn't specify the type of payment scheme- not enough info.

[g2chin]

Payments at beginning of year every two years. What is value at T + 5? (Given investment year method for first three years and portfolio method thereafter)? What you all get?

[sha6188]

oh man i thought it said at the end of each year??. what about the one that had forward rate and was suppose to find first years spot rate? arent they equal during first year