CFA Level 2
Move from describing concepts to applying them, using the same ten areas to analyse and evaluate investments in greater depth.
Learning Objectives
5 objectivesApply quantitative methods and economic analysis to the evaluation of investments.
Analyse financial statements and corporate finance decisions in greater depth.
Evaluate equity, fixed income, derivative and alternative investments using appropriate valuation approaches.
Assess how individual investments affect the construction of a portfolio.
Apply the ethical and professional standards to practical investment situations.
Programme Outline
10 topicsQuantitative Methods
Multiple regression and how to test and extend a model, time-series analysis, machine learning and big data projects.
Economics
What determines the equilibrium value of a currency, and the theories that explain long-run economic growth.
Corporate Finance
Dividend and share repurchase policy, ESG considerations in investment analysis, advanced cost of capital, and corporate restructuring.
Financial Statement Analysis
Intercorporate investments, post-employment and share-based pay, multinational operations, the analysis of financial institutions, and the quality of financial reports.
Equity Investments
Valuation put to work: dividend, free cash flow and residual income models, price and enterprise value multiples, and the valuation of private companies.
Fixed Income
The term structure and interest rate dynamics, arbitrage-free valuation, bonds with embedded options, credit analysis models and credit default swaps.
Derivatives
Pricing and valuing forward commitments, and valuing options and other contingent claims.
Alternative Investments
Commodities and commodity derivatives, real estate held directly and through traded securities, and hedge fund strategies.
Portfolio Construction
How expectations drive market valuation, active portfolio management, exchange-traded funds, multifactor models, market risk measurement and backtesting.
Ethical and Professional Standards
The Code and Standards applied to realistic situations, with guidance on each of the seven Standards.
Hands-On Resources
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