Archive for the ‘Quantitative Methods’ Category

Quantitative Methods #6: Distributions

What is a probability distribution? It is a list of all possible outcomes of an experiment that details the probabilities of each result. A distribution will either be discrete if the possible results are possible to count (example would be …

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Quantitative Methods #5: Relations Between Events

In the past few posts, I took a look at return/risks for individual assets. Those are critical to understand but as you know we live in a much more complex world than that. Events are rarely random. In most cases, …

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Quantitative Methods #4: Volatility Against Returns

Yesterday we discussed risk measures such as variance and standard deviation. However, looking at a risk without an expected return is like bread with no butter… Something is missing. CFA material puts a lot of importance on different ways to …

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Quantitative Methods #3: Volatility Measures

You might have heard about variance, standard deviation and other measures of risk. What are they and how should they be used? To put things in a very simple form, they are measures that help determine how volatile a return …

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Quantitative Methods # 2 : Required Rate Of Returns And Means

There is a small but important distinction between a required nominal rate of return and a required real rate of return. What is it? Inflation. When evaluating a company, a project or even just a series of cash flows, you …

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Quantitative Methods #1: Time Value Of Money Basics

In this post, I will go over some basics that you must know before attempting your CFA exam. I do not want to start with Ethics for reasons that I will explain later on so let’s get into Quantitative Methods. …

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