https://gdpark.blog/categories/cfa/Recent content in CFA on gdpark.blogHugoenTue, 28 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-01-level-1-content-review/Sun, 22 Sep 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-01-level-1-content-review/We rebuild arithmetic vs geometric mean from scratch — and why using the wrong average on stock returns will quietly wreck your portfolio lol.https://gdpark.blog/posts/cfa-l1-01-balance-sheet/Wed, 31 Mar 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-01-balance-sheet/Kicking off the FRA grind from absolute zero — what Financial Reporting Analysis even is, why accounting matters, and a first peek at the balance sheet.https://gdpark.blog/posts/cfa-l1-01-introduction/Wed, 31 Mar 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-01-introduction/Kicking off a weekly series to transcribe my CFA class notes — maybe with a backtest or two — on a heroic 30-min-a-day schedule. Fighting!!!!https://gdpark.blog/posts/cfa-l2-02-forward-pricing/Sun, 10 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-02-forward-pricing/A casual walkthrough of forward pricing for zero coupon bonds — showing how today’s spot rates imply a locked-in future price, and why realized rates rarely match what we expected.https://gdpark.blog/posts/cfa-l1-02-income-statement-and-cash-flow-statement/Thu, 08 Apr 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-02-income-statement-and-cash-flow-statement/Quick rundown of the income statement — what it shows, why revenue ≠ profit, and why accountants split out discontinued operations so shareholders don’t get played.https://gdpark.blog/posts/cfa-l2-03-par-rate/Mon, 11 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-03-par-rate/Par rate is just the YTM of a bond trading at face value — and once you get that, bootstrapping spot rates from the par curve is honestly just arithmetic.https://gdpark.blog/posts/cfa-l1-03-accrual-accounting/Sun, 11 Apr 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-03-accrual-accounting/A casual breakdown of why accrual accounting exists — from the ‘does undelivered revenue count?’ dilemma to how GAAP, IFRS, and K-IFRS all fit together.https://gdpark.blog/posts/cfa-l2-04-rolling-down-the-yield-curve/Wed, 13 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-04-rolling-down-the-yield-curve/A casual breakdown of how buying longer-maturity bonds and selling early lets you squeeze out extra return by rolling down an upward-sloping yield curve.https://gdpark.blog/posts/cfa-l1-04-inventories-1-acquisition-cost/Fri, 16 Apr 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-04-inventories-1-acquisition-cost/We kick off our B/S line-item series with inventories — what they are, how acquisition cost first hits the books, and the cash-vs-credit purchase breakdown.https://gdpark.blog/posts/cfa-l2-05-swap-rate-curve/Fri, 15 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-05-swap-rate-curve/Breaking down what swap rates actually are, why the swap curve matters as a benchmark, and how it stacks up against government bond yield curves.https://gdpark.blog/posts/cfa-l1-05-inventories-2-cost-flow-assumptions/Thu, 22 Apr 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-05-inventories-2-cost-flow-assumptions/When prices and quantities change every single time you buy, you need a cost flow assumption — here’s the rundown on FIFO, LIFO, weighted average, and perpetual vs. periodic.https://gdpark.blog/posts/cfa-l2-06-spread-measures/Sat, 16 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-06-spread-measures/A been-here-done-this rundown of swap spread, I-spread (yes, with that annoying linear interpolation), and Z-spread — basically Level 1 déjà vu, but let’s power through it.https://gdpark.blog/posts/cfa-l1-06-inventories-3-lifo-reserve/Sun, 02 May 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-06-inventories-3-lifo-reserve/A casual walkthrough of how FIFO vs. LIFO choices ripple through key financial ratios — liquidity, solvency, and activity — before diving into the LIFO reserve.https://gdpark.blog/posts/cfa-l2-07-term-structure-theory/Sun, 17 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-07-term-structure-theory/A quick rundown of the theories that explain why the yield curve slopes the way it does — and the sneaky exam traps hiding in each one.https://gdpark.blog/posts/cfa-l1-07-inventories-4-lower-of-cost-or-market-lcm/Sun, 09 May 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-07-inventories-4-lower-of-cost-or-market-lcm/We plug the last inventory gap: when year-end hits, unsold stock on the B/S gets valued at whichever is lower — historical cost or market value — that’s the LCM method.https://gdpark.blog/posts/cfa-l2-08-yield-curve-risks-and-economic-factors-nelson-siegel-model/Mon, 18 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-08-yield-curve-risks-and-economic-factors-nelson-siegel-model/Why effective duration falls flat for non-parallel yield curve shifts — and how key rate duration and the Nelson-Siegel model actually fix that.https://gdpark.blog/posts/cfa-l1-08-property-plant-and-equipment-1-acquisition/Sun, 16 May 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-08-property-plant-and-equipment-1-acquisition/We kick off long-lived assets by diving into PP&E acquisition — what counts as an asset, why it’s not just an expense, and how initial recognition works.https://gdpark.blog/posts/cfa-l2-09-yield-curve-volatility-and-term-premium/Wed, 20 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-09-yield-curve-volatility-and-term-premium/Finally wrapping up Chapter 1 — yield curve volatility, term premium, and how the curve twists with expansions, recessions, and flight-to-quality~https://gdpark.blog/posts/cfa-l1-09-property-plant-and-equipment-2-depreciation/Sun, 23 May 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-09-property-plant-and-equipment-2-depreciation/A casual breakdown of accounting depreciation for PPE — turns out it’s about spreading costs over useful life, not just saying an asset lost value.https://gdpark.blog/posts/cfa-l2-10-the-arbitrage-free-valuation-framework/Wed, 27 Nov 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-10-the-arbitrage-free-valuation-framework/Chapter 2 kicks off with arbitrage-free bond valuation — value additivity, dominance, and the binomial interest rate tree where volatility is the secret sauce!https://gdpark.blog/posts/cfa-l1-10-property-plant-and-equipment-3-revaluation-model/Sat, 29 May 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-10-property-plant-and-equipment-3-revaluation-model/IFRS lets you pick the Revaluation Model for PPE — and here’s why that’s a big deal (and a headache) compared to just sticking with the Cost Model.https://gdpark.blog/posts/cfa-l2-11-binomial-trees-part-2/Mon, 16 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-11-binomial-trees-part-2/This time we build the interest rate tree from scratch — calibration, e^{2σ} forward-rate spacing, and all — then value it via backward induction or pathwise.https://gdpark.blog/posts/cfa-l2-11-valuing-option-free-bonds-with-the-binomial-model/Sat, 14 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-11-valuing-option-free-bonds-with-the-binomial-model/A quick walkthrough of valuing option-free bonds using backward induction on a binomial tree, plus why pathwise valuation matters when cash flows are path-dependent.https://gdpark.blog/posts/cfa-l1-11-property-plant-and-equipment-4-impairment/Sat, 29 May 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-11-property-plant-and-equipment-4-impairment/Breaks down PPE impairment — what ‘gone bad’ actually means, how US-GAAP’s two-step recovery test works, and where IFRS handles things differently.https://gdpark.blog/posts/cfa-l2-12-term-structure-models-cir-vasicek-ho-lee-and-kwk/Mon, 16 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-12-term-structure-models-cir-vasicek-ho-lee-and-kwk/A rundown of CIR, Vasicek, Ho-Lee, and KWK — what makes each term structure model tick and the key characteristics you actually need to nail for the exam.https://gdpark.blog/posts/cfa-l1-12-investment-property/Sun, 06 Jun 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-12-investment-property/Investment property is just rental real estate — not speculation — and here’s how it differs from PPE under IFRS (spoiler: US GAAP doesn’t even have this account).https://gdpark.blog/posts/cfa-l2-13-bonds-with-embedded-options/Wed, 25 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-13-bonds-with-embedded-options/A quick rundown of callable vs. putable bonds — who holds the option, why callables are cheaper, and how to back out the embedded option value from the straight bond price.https://gdpark.blog/posts/cfa-l1-13-intangible-assets/Sat, 12 Jun 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-13-intangible-assets/A breakdown of intangible assets — what they are, how they stack up against PP&E, and the surprisingly messy rules for getting them onto the B/S.https://gdpark.blog/posts/cfa-l2-14-valuing-bonds-with-embedded-options-part-1/Wed, 25 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-14-valuing-bonds-with-embedded-options-part-1/We finally put the Binomial Tree Framework to work pricing callable and putable bonds, walking through how cash flows shift at every node as rates move.https://gdpark.blog/posts/cfa-l1-14-income-tax-expense/Sat, 19 Jun 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-14-income-tax-expense/Breaking down how corporate tax expense actually works — from taxable income reconciliation to current vs. deferred tax — purely from the CFA angle, heh.https://gdpark.blog/posts/cfa-l2-15-interest-rate-volatility-rate-level-and-yield-curve-changes/Wed, 25 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-15-interest-rate-volatility-rate-level-and-yield-curve-changes/Here’s the breakdown on how volatility, rate levels, and yield curve shape each hit the value of embedded options in callable and putable bonds — exam staples, all three.https://gdpark.blog/posts/cfa-l1-15-effective-interest-rate-method-a-complete-accounting-guide/Sat, 03 Jul 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-15-effective-interest-rate-method-a-complete-accounting-guide/Breaking down the effective interest rate method and amortized cost from the issuer’s side — because honestly, I had to fully get it myself before I could explain it!https://gdpark.blog/posts/cfa-l2-16-option-adjusted-spread-oas/Fri, 27 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-16-option-adjusted-spread-oas/OAS is the constant spread you add to every node of a risk-free binomial tree until your callable bond price matches the market — and spoiler: it has nothing to do with options.https://gdpark.blog/posts/cfa-l1-16-bonds/Sun, 25 Jul 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-16-bonds/Cruising through bonds for CFA prep — par, discount, and premium bonds, how market interest rates set the price, and how it all lands on the financial statements.https://gdpark.blog/posts/cfa-l2-17-key-rate-duration-partial-duration/Sat, 28 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-17-key-rate-duration-partial-duration/A casual walkthrough of duration — modified, effective, and key rate — and why assuming a parallel yield curve shift doesn’t always cut it.https://gdpark.blog/posts/cfa-l1-17-leases/Sat, 31 Jul 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-17-leases/A quick rundown of lease types and lessor/lessee basics you need to know — even though leases are basically gone from CFA Level 1 now, heh heh heh.https://gdpark.blog/posts/cfa-l2-18-capped-and-floored-floaters/Sun, 29 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-18-capped-and-floored-floaters/Capped floaters put a ceiling on the coupon (great for the issuer), floored floaters set a minimum (great for you), and you value both by tweaking a binomial tree and working backward.https://gdpark.blog/posts/cfa-l1-18-pension/Sat, 07 Aug 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-18-pension/Quick intro to post-employment benefits and why you can’t just slap a retirement payout on the I/S all at once — matching principle, retirement allowance systems, and more.https://gdpark.blog/posts/cfa-l2-19-convertible-bonds/Sun, 29 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-19-convertible-bonds/A casual breakdown of convertible bond terminology — conversion ratio, conversion price, conversion value, straight value, and why CBs trade above their theoretical floor.https://gdpark.blog/posts/cfa-l1-19-financial-ratios-1-financial-analysis-techniques/Fri, 13 Aug 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-19-financial-ratios-1-financial-analysis-techniques/A breezy intro to why financial ratios are surprisingly tricky — cross-company comparisons, IFRS vs US-GAAP headaches, the Samsung problem, and whether a 200% debt ratio is even bad.https://gdpark.blog/posts/cfa-l2-20-credit-valuation-adjustment-cva/Sun, 29 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-20-credit-valuation-adjustment-cva/Diving into CVA — that shave-off amount on OTC derivative valuations that accounts for counterparty default risk, because zero-risk counterparties just don’t exist.https://gdpark.blog/posts/cfa-l1-20-financial-ratios-2-financial-analysis-techniques/Sat, 21 Aug 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-20-financial-ratios-2-financial-analysis-techniques/Part 2 of financial ratios — breaking down liquidity ratios like the Current, Quick, Cash, and Defensive Interval ratios with actual intuition, not just exam memorization.https://gdpark.blog/posts/cfa-l2-21-risk-neutral-probability-of-default/Sun, 29 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-21-risk-neutral-probability-of-default/Risk-neutral (aka implied) default probability is just the PD that calibrates you to market prices — so you can discount everything at the risk-free rate, no guesswork needed.https://gdpark.blog/posts/cfa-l1-21-dupont-analysis/Fri, 27 Aug 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-21-dupont-analysis/DuPont Analysis is basically about ripping ROE apart into three pieces — Net Profit Margin, Asset Turnover, and Financial Leverage — so each one actually means something.https://gdpark.blog/posts/cfa-l2-22-credit-scores-and-credit-ratings/Mon, 30 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-22-credit-scores-and-credit-ratings/A quick breakdown of how credit scores differ from credit ratings, why subordinated bonds get notched down, and what credit migration does to bond prices.https://gdpark.blog/posts/cfa-l1-22-financial-assets-and-accounts-receivable/Sun, 19 Sep 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-22-financial-assets-and-accounts-receivable/Back to the B/S! We dig into financial assets, break down non-derivative instruments, and learn why the classic maturity-date rule for debt vs. equity doesn’t always hold up.https://gdpark.blog/posts/cfa-l2-23-structural-and-reduced-form-credit-models/Mon, 30 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-23-structural-and-reduced-form-credit-models/A casual walkthrough of structural vs. reduced-form credit models — just enough to nail the pros and cons without drowning in the math.https://gdpark.blog/posts/cfa-l1-23-equity/Sun, 26 Sep 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-23-equity/A casual (expectations: low!) walkthrough of equity on the balance sheet — paid-in capital, par value, share premium, and just enough accounting cycle to get by for the CFA exam.https://gdpark.blog/posts/cfa-l2-24-credit-spread-analysis-and-term-structure-of-credit-spreads/Mon, 30 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-24-credit-spread-analysis-and-term-structure-of-credit-spreads/VND, CVA, and why credit spreads have their own term structure — plus what credit quality, the economy, liquidity, and equity vol do to the curve shape.https://gdpark.blog/posts/cfa-l1-24-statement-of-changes-in-equity-and-non-recurring-items/Sat, 02 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-24-statement-of-changes-in-equity-and-non-recurring-items/A breezy tour of the Statement of Changes in Equity, then a quick rundown on bad debt and warranty expense — and how both quietly create DTAs on the B/S.https://gdpark.blog/posts/cfa-l2-25-credit-default-swaps-cds-and-cds-premium/Mon, 30 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-25-credit-default-swaps-cds-and-cds-premium/CDS isn’t your typical derivative — it’s basically bond insurance, and this post breaks down the structure, settlement types, and why you don’t even need to own the bond.https://gdpark.blog/posts/cfa-l1-25-cash-flow-statement/Mon, 11 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-25-cash-flow-statement/We finally made it to the cash flow statement — why it exists, why accrual alone isn’t enough, and how CFO/CFI/CFF each tell a different part of the story.https://gdpark.blog/posts/cfa-l1-25-earnings-per-share-eps/Sun, 03 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-25-earnings-per-share-eps/Breaking down EPS the CFA way — weighted average shares, preferred stock deductions, and why dilutive securities make the whole thing a little messy.https://gdpark.blog/posts/cfa-l2-26-credit-default-swaps-cds-part-2/Tue, 31 Dec 2024 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-26-credit-default-swaps-cds-part-2/A casual breakdown of single-name vs. index CDS, how credit correlation drives pricing, and why expected loss is the number that really matters.https://gdpark.blog/posts/cfa-l1-26-cash-flow-statement-and-ebitda/Sat, 16 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-26-cash-flow-statement-and-ebitda/Working through a real B/S and I/S to build a Cash Flow Statement step by step — tagging every line item as O, I, or F and smashing out CFI, CFF, and CFO the direct way.https://gdpark.blog/posts/cfa-l2-27-fra-orientation-and-overview/Sun, 05 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-27-fra-orientation-and-overview/A quick orientation on CFA Level 2 FRA — ditching the shallow-but-wide Level 1 style to go deeper on 5 big themes, kicking off with intercorporate investments.https://gdpark.blog/posts/cfa-l1-27-free-cash-flow-and-fra-wrap-up/Sun, 17 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-27-free-cash-flow-and-fra-wrap-up/Finally putting a period on FRA with a casual-but-essential look at FCFF and FCFE — what they are, how to build them from net income, and why WACC is the right discount rate.https://gdpark.blog/posts/cfa-l2-28-investments-in-financial-assets/Sun, 05 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-28-investments-in-financial-assets/A casual breakdown of the three types of intercorporate investments — financial assets, associates, and subsidiaries — and how to tell them apart on exams and in real life.https://gdpark.blog/posts/cfa-l1-28-what-is-a-bond-the-fundamental-difference-from-equity/Sun, 24 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-28-what-is-a-bond-the-fundamental-difference-from-equity/Kicking off Fixed Income for CFA Level 1 — what a bond actually is, why interest is called a coupon, and how it’s fundamentally different from a stock.https://gdpark.blog/posts/cfa-l2-29-equity-method-accounting-fundamentals/Mon, 06 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-29-equity-method-accounting-fundamentals/A breakdown of why associate stocks skip fair-value measurement and how the equity method pipes B’s net income straight into A’s books to close the dividend-manipulation loophole.https://gdpark.blog/posts/cfa-l1-29-types-of-bonds/Sun, 31 Oct 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-29-types-of-bonds/A quick rundown of bond types by how they pay interest — floaters, inverse floaters, PIK bonds, index-linked, and the contingency provisions baked right in.https://gdpark.blog/posts/cfa-l2-30-equity-method-accounting-advanced-topics/Tue, 07 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-30-equity-method-accounting-advanced-topics/Real-life equity-method: BV ≠ FV, a control premium gets stapled on top, and you’ve gotta reconstruct income from an FV lens — exactly what the CFA exam tests.https://gdpark.blog/posts/cfa-l1-30-key-fixed-income-terminology/Sun, 05 Dec 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-30-key-fixed-income-terminology/A casual rundown of fixed income exam keywords — LIBOR, bond issuance methods, underwritten vs. best efforts offerings, primary dealers, and shelf registration.https://gdpark.blog/posts/cfa-l2-31-equity-method-accounting-intercompany-transactions-and-impai/Wed, 08 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-31-equity-method-accounting-intercompany-transactions-and-impai/A casual breakdown of how intercompany transactions mess with your equity-method income — upstream, downstream, unrealized profits, and when impairment comes knocking.https://gdpark.blog/posts/cfa-l1-31-bond-valuation/Sun, 12 Dec 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-31-bond-valuation/Bond valuation is just PV of future cash flows — once you lock in why price adjusts to match required return, the rest of fixed income stops wrecking your mental health. heh heh!!https://gdpark.blog/posts/cfa-l2-32-proportionate-consolidation/Thu, 09 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-32-proportionate-consolidation/A quick breakdown of proportionate consolidation — folding in assets, liabilities, revenues, and expenses at your exact ownership %, and why accounting standards don’t actually use it.https://gdpark.blog/posts/cfa-l1-32-yield-measures/Sun, 19 Dec 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-32-yield-measures/Breaking down why coupon rate isn’t your bond’s ’true’ yield, and how payment frequency changes everything when you’re comparing bonds apple to apple.https://gdpark.blog/posts/cfa-l2-33-full-consolidation-the-acquisition-method/Fri, 10 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-33-full-consolidation-the-acquisition-method/A casual breakdown of why full consolidation wins over proportionate consolidation, how NCI keeps the balance sheet balanced, and what it does to your ROE and ROA.https://gdpark.blog/posts/cfa-l1-33-understanding-geometric-mean-return-for-the-yield-curve/Sat, 25 Dec 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-33-understanding-geometric-mean-return-for-the-yield-curve/Finally tackling the yield curve — but first, why geometric mean return (not arithmetic mean) is the only correct way to think about % gains over time.https://gdpark.blog/posts/cfa-l2-34-goodwill-full-and-partial-and-bargain-purchases/Sat, 11 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-34-goodwill-full-and-partial-and-bargain-purchases/Breaking down how goodwill pops out of consolidation accounting, how NCI gets booked, and what happens with partial goodwill and bargain purchases — CFA-style.https://gdpark.blog/posts/cfa-l1-34-yield-curve/Sat, 25 Dec 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-34-yield-curve/Finally cracking open the yield curve — spot rates, zero coupon bonds, and why discounting everything at one single yield is kinda ridiculous.https://gdpark.blog/posts/cfa-l2-35-special-purpose-entities-spe-and-variable-interest-entities/Sun, 12 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-35-special-purpose-entities-spe-and-variable-interest-entities/VIEs always get consolidated — no exceptions — and here’s the wild history of how Korea’s IMF crisis, ABS, and IFRS killed off-balance-sheet SPC financing for good.https://gdpark.blog/posts/cfa-l1-35-yield-spread/Fri, 31 Dec 2021 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-35-yield-spread/A casual breakdown of yield spreads — what G-spread and I-spread actually mean, why swap rates beat LIBOR as the private-sector risk-free rate, and how traders decide if a bond is cheap or rich.https://gdpark.blog/posts/cfa-l2-36-defined-benefit-pension-plans-accounting-treatment/Sat, 25 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-36-defined-benefit-pension-plans-accounting-treatment/A breakdown of how severance pay and DB/DC pension plans hit the financial statements — and why stashing money outside the company matters when things go south.https://gdpark.blog/posts/cfa-l1-36-price-risk-reinvestment-risk-and-duration/Sat, 08 Jan 2022 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-36-price-risk-reinvestment-risk-and-duration/YTM secretly assumes you reinvest every coupon at YTM itself — and that hidden assumption is exactly where price risk and reinvestment risk come from.https://gdpark.blog/posts/cfa-l2-37-defined-benefit-pension-plans-analytical-perspective/Sun, 26 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-37-defined-benefit-pension-plans-analytical-perspective/Even though it got yanked from the 2024 CFA L2 curriculum, here’s how analysts reclassify pension F/S and compute TPPC — both ways — from an economic lens.https://gdpark.blog/posts/cfa-l1-37-credit-analysis-and-credit-ratings/Sun, 23 Jan 2022 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-37-credit-analysis-and-credit-ratings/A breezy skim through credit analysis — cash flow, bond indentures, and why credit loss is basically just lottery math but for money you might lose.https://gdpark.blog/posts/cfa-l2-38-share-based-compensation/Sun, 26 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-38-share-based-compensation/Picking up with post-employment benefits and share-based comp — breaking down the actuarial stuff, stock options, SARs, and the vesting quirks you actually need to know.https://gdpark.blog/posts/cfa-l1-38-asset-backed-securities-abs-and-the-global-financial-crisis/Sat, 05 Feb 2022 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-38-asset-backed-securities-abs-and-the-global-financial-crisis/ABS, MBS, maturity mismatches, and yes — the full 2008 meltdown with AIG and everything. Buckle up, it’s the grand finale of the Fixed Income series!https://gdpark.blog/posts/cfa-l2-39-multinational-operations/Mon, 27 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-39-multinational-operations/A quick breakdown of transaction exposure — how FX rate changes hit your AR and what counts as realized vs. unrealized in multinational accounting.https://gdpark.blog/posts/cfa-l1-39-fixed-income-wrap-up/Sun, 13 Feb 2022 00:00:00 +0000https://gdpark.blog/posts/cfa-l1-39-fixed-income-wrap-up/Wrapping up the whole Fixed Income series with a keyword-by-keyword tour of securitization, covered bonds, RMBS vs. CMBS, and call protection mechanics.https://gdpark.blog/posts/cfa-l2-40-foreign-currency-translation-types-of-currency/Mon, 27 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-40-foreign-currency-translation-types-of-currency/A quick breakdown of the three currency types you need for translation — local, functional, and presentation — using Samsung as the running example.https://gdpark.blog/posts/cfa-l2-41-the-current-rate-method/Tue, 28 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-41-the-current-rate-method/A quick rundown of the Current Rate Method — when to use it, how to translate I/S before B/S, and how to make sense of AOCI without overcomplicating it!!https://gdpark.blog/posts/cfa-l2-42-the-temporal-method/Tue, 28 Jan 2025 00:00:00 +0000https://gdpark.blog/posts/cfa-l2-42-the-temporal-method/Breaking down the Temporal Method — when to use it, which assets get translated at what rate, and how to snap to a gain/loss answer fast on the CFA.