
CFA LEVEL I Quantitative Methods
Online Course
Basic Info : Quantitative Methods Level : CFA LEVEL 1 Commitment : 20 hour (10 sessions of 2 hours each) Language : English Schedule Date:
What Will I Learn
When you are done with this course, you will be able to:
 Learn quantitative concepts and techniques used in financial analysis and investment decision making.
 Gain an indepth understanding of the time value of money and discounted cash flow analysis that form the basis for cash flow and security valuation.
 Attain the skills to unravel the complex characteristics of return distributions such as symmetry, skewness, and kurtosis.
 Understand how descriptive statistics is used for conveying important data attributes such as central tendency, location, and dispersion.
Curriculum
Session 1
 Time Value of Money
 • What is time value? The relationship (equation) between present value and future value
 • Solving TVM using your financial calculator
 • The 3 interpretations of an interest rate
 • The components of the interest rate (risk free, inflation, default risk, and other risk premiums)
 • Calculating the effective annual rate and dealing with nonannual compounding periods
 • Annuity calculations for ordinary annuities, annuity due, and perpetuities
Session 2
 Discounted Cash Flows (DCF) I
 • The Net Present Value (NPV) equation and calculating it on your financial calculator
 • A conceptual understanding of IRR and the ability to solve for IRR on your calculator
 • The pros/cons of IRR vs. NPV and an ability to compare/contrast the two
 • NPV/IRR decision rules, why they might yield different results for nonexclusive projects
Session 3
 Discounted Cash Flows (DCF) II
 • Calculating the Time Weighted Rate of Return (TWRR)
 • Comparing/contrasting when TWRR and MWRR (money weighted rate of return) would yield different values and which would have a higher/lower value given timing of cash flows and investment performance
 • Holding Period Return, Bank Discount Yield, Effective Annual Yield, Money Market Yield and the relationship between them
Session 4
 Key Statistical ConceptsI
 • Basic difference between populations and samples
 • The Measurement Scales (NOIR)
 • Histograms and reading an Absolute, Relative, and Cumulative Frequency table
 • Measures of central tendency  Calculate mean, median, mode, geometric mean & know their relative values with left/right skew
 • Measures of dispersion  calculate range, variance, standard deviation semivariance, and the coefficient of variation
Session 5
 Key Statistical ConceptsII
 • Calculate a weighted average and compound return
 • Understand the normal distribution, its key properties, and the observations within X # of standard deviations
 • Be able to calculate and interpret confidence intervals
 • Be able to talk about positive and negative skew as well as kurtosis and what that means for risk and returns
 • Calculate and interpret the Sharpe ratio and Roys Safety First Criteria
Session 6
 Probability & Probability ConceptsI
 • Define a random variable, an outcome, an event, mutually exclusive events, and exhaustive events;
 • State the two defining properties of probability and distinguish among empirical, subjective, and a priori probabilities;
 • State the probability of an event in terms of odds for and against the event;
 • Distinguish between unconditional and conditional probabilities;
 • Explain the multiplication, addition, and total probability rules;
Session 7
 Probability & Probability ConceptsIII
 • Calculate and interpret
 The joint probability of two events
 The probability that at least one of two events will occur, given the probability of each and the joint probability of the two events
 A joint probability of any number of independent events;
 • Distinguish between dependent and independent events;
 • Calculate and interpret an unconditional probability using the total probability rule;
Session 8
 Probability & Probability ConceptsIII
 • Explain the use of conditional expectation in investment applications;
 • Explain the use of a tree diagram to represent an investment problem;
 • Calculate and interpret covariance and correlation;
 • Calculate and interpret the expected value, variance, and standard deviation of a random variable and of returns on a portfolio;
 • Calculate and interpret covariance given a joint probability function;
 • Calculate and interpret an updated probability using bayes’ formula; identify the most appropriate method to solve a particular counting problem and solve counting problems using factorial, combination, and permutation concepts.
Session 9
 Hypothesis testing The 7 steps of constructing a hypothesis test
 • Defining / distinguishing between a null and alternative hypothesis
 • Understanding the rejection area for Hnull, picking the right test statistic, and reading a t/z table for either a 1sided or 2sided test using a critical value in order to use a decision rule
 • The tradeoff between the level of significance and Type I/Type II errors
 • Distinguishing between a Type I/Type II error
 • Basic understanding of the pvalue, chisquared test, and Ftest
Session 10
 Technical Analysis  Key assumptions of technical analysis
 • How technical analysis differs from fundamental analysis
 • Line charts, Bar charts, Candlesticks, and Point/Figure Charts
 • Support & Resistance, Trend lines and Breakouts, and the idea of polarity
 • Reversal patterns  Head & shoulders, Double/Triple top & calculating price target from the move
 • Continuation patterns  Triangles, Rectangles, Flags/Pennants
 • Pricebased indicators  moving averages, Bollinger bands,
 • Momentum oscillators  ROC, RSI, MACD, Stochastic
 • Sentiment indicators  Put/Call ratio, VIX, Margin Debt, Short interest ratio, Flow of Funds Indicator, New Equity Issuances
 • Elliot Wave Theory
Includes
Interactive Sessions
Sessionspecific Assignments(* Condition Apply)
Certificate from BSE Institute Ltd.
Training 5 or more people ?
We provide custom courses and group sessions as well. To know more about our Customized Programs, click here.
Try BSE Business
How It works
Live Online Sessions
Each session is interactive and informative, featuring case studies, quizzes and projects
Interact, Learn and Grow
BSEVarsity.com enables you to master the concepts, interact with expert faculty and other learners and be a part of the community whilst growing.
Get Certified
Get Certified from BSE Institute Ltd. Share your success with world